Alex Omenye
Amazon’s attempt to acquire iRobot, the renowned robotic vacuum manufacturer, has come to an end due to challenges faced with European regulators.
Both companies have decided to mutually terminate the previously-announced acquisition agreement, where Amazon intended to buy iRobot for approximately $1.7 billion in cash, or a slightly lower amount.
The companies issued a joint press release stating that they perceived “no path to regulatory approval in the European Union,” resulting in the inability to proceed with the deal.
Expressing disappointment, David Zapolsky, Amazon’s Senior Vice President and General Counsel, mentioned in a prepared statement, “We’re disappointed that Amazon’s acquisition of iRobot could not proceed.”
As a consequence of the abandoned bid, iRobot will receive a termination fee of $94 million from Amazon. However, the failed acquisition will also compel iRobot to implement an “operational restructuring plan,” leading to the termination of around 350 iRobot employees, constituting approximately 31% of the company’s workforce, by April.
iRobot, established in 1990 by members of the MIT Artificial Intelligence Lab, Rodney Brooks, Angle, and Helen Greiner, gained prominence twelve years later with the introduction of the Roomba. The Roomba brand has since become synonymous with robotic vacuums, boasting sales of over 30 million units as of 2020.
While iRobot faced setbacks with the failed acquisition, Amazon has been actively venturing into the robotics sector, taking steps into the home environment with the introduction of Astro. However, Amazon’s robot, Astro, has encountered challenges in gaining traction among consumers.
