Amazon and iRobot, the maker of Roomba, have mutually decided to terminate their $1.4 billion merger agreement due to opposition from European antitrust regulators. This marks the first instance of Amazon being prevented from acquiring another company by antitrust authorities.
The deal, initially announced in mid-2022 with a $1.7 billion valuation, was part of Amazon’s strategy to expand its smart home device portfolio, which already includes products like Ring and Alexa. However, EU antitrust regulators raised concerns that Amazon might give preferential treatment to iRobot products over competitors on its marketplace.
While the deal had received approval from U.K. antitrust authorities, it was still under investigation by the U.S. Federal Trade Commission. In response to the termination, Amazon expressed disappointment, stating that “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.”
As a result of the deal’s cancellation, Amazon will pay $94 million to iRobot. Following this announcement, iRobot’s shares have fallen by more than 18% in pre-market trading.
Sources include: Axios
