Amazon Nixes $1.4B Deal to Buy iRobot
Amazon and vacuum manufacturer iRobot have called off their merger, which was signed on August 4, 2022, citing “no path to regulatory approval in the European Union.”
Amazon will pay iRobot a termination fee of $94 million. The deal would have valued iRobot at around $1.4 billion.
The European Commission had voiced concern that Amazon might delist or reduce the exposure of competitor robot vacuum cleaners, limiting competition and “leading to higher prices, lower quality, and less innovation for consumers.”
“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 very things that regulators say they’re trying to protect,” said David Zapolsky, Amazon SVP and General Counsel.
iRobot also said it will pursue an operational reorganization plan and lay off around 31% of its workforce, or 350 people. In addition, iRobot CEO and Chair Colin Angle has stepped down, effective immediately.
iRobot intends to incur restructuring charges ranging from $12 million to $13 million, principally for severance and related expenditures, over the first two quarters of 2024, with most of the charges expected in the first quarter.
