Amazon and robot vacuum manufacturer iRobot have decided to abandon their merger plans due to opposition from EU antitrust regulators.
In response to this development, iRobot has unveiled a substantial restructuring initiative aimed at cost reduction. As part of this plan, the company will slash approximately 31% of its workforce, which amounts to 350 jobs. Additionally, Colin Angle has stepped down from his position as CEO.
Amazon’s proposed $1.4 billion acquisition of iRobot faced insurmountable hurdles in gaining regulatory approval within the European Union. Earlier this month, Reuters reported that the European Commission’s antitrust regulators were set to block the deal. Their primary concerns centered around Amazon potentially stifling competition from iRobot’s rivals on its online marketplace, particularly in France, Germany, Italy, and Spain.
The announcement of this acquisition by Amazon took place in August 2022. The world’s largest online retailer, already known for owning brands like Alexa and Ring, sought to expand its portfolio of smart home devices while further strengthening its presence in the virtual healthcare sector.
David Zapolsky, Amazon’s general counsel, expressed disappointment regarding the inability to proceed with the iRobot acquisition. He emphasized Amazon’s belief in the future of consumer robotics for homes and praised iRobot’s products.
As a consequence of this news, iRobot’s shares experienced a decline of 14.7% in pre-market trading.
Critics of the proposed merger had raised concerns that it would further solidify Amazon’s dominant position in the smart home device market.
