Amazon’s
deal
to
buy
Roomba
maker
iRobot
is
off,
the
companies
announced
today,
after
iRobot
said
the
deal
has
“no
path
to
regulatory
approval
in
the
European
Union.”
iRobot
is
also
announcing
that
it’s
laying
off
around
350
employees,
or
around
31
percent
of
its
workforce
as
part
of
a
restructuring.
It
expects
to
notify
the
majority
of
affected
employees
by
the
end
of
March.
As
part
of
the
announcement,
iRobot
chair
and
CEO
Colin
Angle,
who
co-founded
the
company
in
1990,
is
stepping
down
from
both
roles.
iRobot’s
current
executive
vice
president
and
chief
legal
officer,
Glen
Weinstein,
will
serve
as
interim
CEO,
and
Andrew
Miller,
formerly
lead
independent
director
of
the
board,
will
become
chair.
As
part
of
the
restructuring,
iRobot
is
pausing
its
work
on
devices
outside
of
its
core
floor-cleaning
product
lineup
like
air
purifiers
and
lawn
mowers,
and
closing
offices
and
facilities
in
“smaller,
underperforming
geographies.”
The
collapse
of
the
deal
means
Amazon
will
pay
a
$94
million
termination
fee
to
iRobot,
which
will
largely
be
used
to
help
pay
off
a
$200
million
loan
it
took
out
last
year.
As
part
of
today’s
announcement,
iRobot
published
its
preliminary
fourth
quarter
results
for
2023
and
said
it
expects
to
report
a
GAAP
operating
loss
of
“between
$265
and
$285
million.”
The
announcement
comes
after
the
$1.4
billion
acquisition
ran
into
difficulties
with
EU
regulators.
Last
November,
the
European
Commission
said
it
believed
the
deal
had
the
potential
to
restrict
competition
in
the
robot
vacuum
cleaner
market.
Many
of
iRobot’s
competitors
also
sell
their
devices
on
Amazon’s
online
store,
and
regulators
were
concerned
that
Amazon
could
delist
or
reduce
the
visibility
of
rival
robot
vacuum
cleaners,
restricting
competition
and
“leading
to
higher
prices,
lower
quality,
and
less
innovation
for
consumers.”
Amazon
had
until
January
10th
to
try
to
convince
the
European
Commission
to
let
the
deal
go
through,
but
Politico
reported
that
the
deadline
passed
without
Amazon
offering
any
concessions.
The
companies
first
announced
the
deal
in
August
2022
and
received
the
go-ahead
from
the
UK’s
competition
regulator
in
June
2023.
“Undue
and
disproportionate
regulatory
hurdles
discourage
entrepreneurs”
In
a
statement,
Amazon
SVP
and
general
counsel
David
Zapolsky
said
he
was
“disappointed”
that
the
deal
couldn’t
proceed.
“This
outcome
will
deny
consumers
faster
innovation
and
more
competitive
prices,
which
we’re
confident
would
have
made
their
lives
easier
and
more
enjoyable,”
Zapolsky
said.
“Mergers
and
acquisitions
like
this
help
companies
like
iRobot
better
compete
in
the
global
marketplace,
particularly
against
companies,
and
from
countries,
that
aren’t
subject
to
the
same
regulatory
requirements
in
fast-moving
technology
segments
like
robotics.
Undue
and
disproportionate
regulatory
hurdles
discourage
entrepreneurs,
who
should
be
able
to
see
acquisition
as
one
path
to
success,
and
that
hurts
both
consumers
and
competition.”
The
deal
is
one
of
several
major
tech
acquisitions
to
have
fallen
apart
in
recent
years
as
global
regulators
ramp
up
scrutiny.
Adobe
walked
away
from
its
$20
billion
deal
to
buy
Figma
late
last
year
in
the
face
of
pressure
from
UK
and
EU
regulators,
Nvidia
formally
abandoned
its
$40
billion
Arm
deal,
citing
“significant
regulatory
challenges”
in
early
2022,
and
even
Meta
was
unable
to
buy
Giphy.
Microsoft
was
able
to
push
its
deal
to
buy
Activision
Blizzard
through,
but
only
after
first
granting
concessions
to
the
UK
and
EU
authorities.
In
the
past,
Amazon
has
been
able
to
make
smart
home
acquisitions
with
less
difficulty.
It
acquired
camera
and
doorbell
company
Blink
in
2017,
home
security
company
Ring
in
2018,
and
mesh
router
company
Eero
in
2019.
Since
then,
Amazon
has
maintained
the
individual
brand
names
of
the
companies
and
has
continued
to
sell
competing
devices
via
its
online
store.
In
the
time
since
announcing
its
plans
to
buy
iRobot,
Amazon’s
devices
and
services
business
has
gained
a
new
boss.
When
the
deal
was
first
announced,
Dave
Limp
was
still
serving
as
Amazon
hardware’s
top
executive.
But
as
of
the
end
of
October
2023,
Limp
had
been
replaced
by
Panos
Panay,
who
moved
into
the
role
from
Microsoft,
while
Limp
has
transitioned
to
CEO
of
Jeff
Bezos’
aerospace
company,
Blue
Origin.
(Originally posted by Jon Porter)
Comments