• EU blocked plans
• Amazon stops takeover plans
• iRobot share price drops again
The retail group Amazon and iRobot announced in a press release on Monday that they were terminating the takeover agreement originally reached in August 2022. A few days ago there were rumors that the deal was about to collapse: The Wall Street Journal (WSJ) reported that the European Union’s competition regulator was planning to block Amazon’s purchase of iRobot. Accordingly, the EU Commission has informed Amazon that the $1.4 billion deal announced in 2022 will probably not come about.
According to the financial service Bloomberg, it wasn’t just EU competition watchdogs that had objections. Senior employees of the US Federal Trade Commission (FTC) informed Amazon last week that they would recommend a lawsuit against the purchase of iRobot, Bloomberg reported on Monday.
Amazon is disappointed
This deal would have allowed Amazon to invest in iRobot’s continued innovation and help iRobot lower prices on products customers already love, the official press release announcing the deal’s cancellation said. “We are disappointed that Amazon’s acquisition of iRobot could not be completed,” said David Zapolsky, SVP and General Counsel of Amazon, in this context. “We believe in the future of consumer robotics in the home and have always been fans of iRobot’s products that delight consumers and solve problems in ways that improve their lives,” it continued.
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The US company also criticizes the EU Commission’s decision in the press release and emphasizes that mergers and acquisitions like these would help companies like iRobot to better compete in the global market, especially against companies and from countries that are in fast-moving Technology segments such as robotics are not subject to the same regulatory requirements. “Inadequate and disproportionate regulatory hurdles discourage entrepreneurs who should view acquisitions as a path to success, and that harms both consumers and competition – the very things regulators claim to protect,” the retail giant continued.
The potential takeover candidate iRobot is also disappointed: “The termination of the agreement with Amazon is disappointing, but iRobot is now turning to the future and focusing on continuing to develop sophisticated robots and smart home innovations that make lives and ours better Customers around the world love it,” Colin Angle, founder of iRobot, is quoted as saying.
For the robot specialist, the cancellation of the deal has immediate consequences: with 350 employees, almost a third of the workforce has to go. Longtime boss Colin Angle is retiring.
iRobot shares on the NASDAQ under pressure
iRobot shares experienced a significant decline in price on the NASDAQ and ultimately fell by 8.77 percent to $15.50. This means that the value of the share has more than halved in the last few trading days.
Amazon stocks also showed a little higher on the NASDAQ: Ultimately, they rose 1.34 percent to $161.26.
Editorial staff at finanzen.net with material from dpa-AFX
Image source: iRobot, iRobot Corporation, Jonathan Weiss / Shutterstock.com