Amazon terminates iRobot deal, vacuum maker to lay off 31% of staff
PUBLISHED MON, JAN 29 20248:37 AM EST
UPDATED 2 MIN AGO
Rohan Goswami @IN/ROHANGOSWAMICNBC/ @ROGOSWAMI
CNBC.com
The iRobot headquarters in Bedford, Massachusetts, US, on Friday, June 16, 2023. Amazon.com Inc.’s proposed $1.7 billion deal to buy robot vacuum firm iRobot Corp. was given the all-clear by the UKs antitrust agency. Photographer: Sophie Park/Bloomberg via Getty Images
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Amazon said on Monday it would not move forward with a planned acquisition of vacuum-maker iRobot, with the two companies saying in a release there was “no path to regulatory approval for the deal.”
The vacuum maker also announced it would lay off 31% of its employees, around 350 people, and that its chair and CEO Colin Angle would step down effective immediately.
iRobot shares fell 15% on the news.
The fate of the deal was plunged into uncertainty after The Wall Street Journal reported that the European Union would not offer regulatory approval.
“We’re disappointed that Amazon’s acquisition of iRobot could not proceed,” Amazon senior vice president and general counsel David Zapolsky said in a release.
iRobot said it would focus on margin improvements, reduce spending on research and development and pause all work on “non-floorcare” products, including its air purifiers and robotic lawn mowers.
Amazon will pay iRobot a previously-agreed-upon $94 million breakup fee. The terminated deal would have valued iRobot at roughly $1.7 billion.
The robotic vacuum maker has a market capitalization of under $400 million, following Monday’s news and prior reports that the European Union would move to block the deal.
The European Commission did not immediately return CNBC’s request for comment.
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Amazon terminates iRobot deal, vacuum maker to lay off 31% of staff (cnbc.com) |
