{"id":577660,"date":"2024-01-29T09:41:40","date_gmt":"2024-01-29T14:41:40","guid":{"rendered":"https:\/\/www.therobotreport.com\/?p=577660"},"modified":"2024-01-30T10:56:51","modified_gmt":"2024-01-30T15:56:51","slug":"irobot-terminates-deal-with-amazon-laying-off-31-of-staff","status":"publish","type":"post","link":"https:\/\/www.therobotreport.com\/irobot-terminates-deal-with-amazon-laying-off-31-of-staff\/","title":{"rendered":"iRobot terminates deal with Amazon, laying off 31% of staff"},"content":{"rendered":"
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An edited image showing an iRobot Roomba with Amazon branding. | Source: iRobot, Amazon<\/p><\/div>\n

iRobot Corp. today announced it is terminating its planned acquisition by Amazon.com Inc. The companies mutually agreed on this decision and blamed “undue and disproportionate” regulatory scrutiny for the demise of the deal.<\/span><\/p>\n

“We’re disappointed that Amazon’s acquisition of iRobot could not proceed,” said David Zapolsky<\/span>, senior vice president and general counsel at Amazon, in a release<\/a>. “We’re believers in the future of consumer robotics in the home and have always been fans of iRobot’s products, which delight consumers and solve problems in ways that improve their lives. Amazon and iRobot were excited to see what our teams could build together, and we’re deeply grateful to everyone who worked tirelessly to try and make this collaboration a reality.”<\/p>\n

Zapolsky cited the need for global competitiveness and said that regulators are impeding innovation.<\/span><\/p>\n

“This outcome will deny consumers faster innovation and more competitive prices, which we’re confident would have made their lives easier and more enjoyable,” he said. “Mergers and acquisitions like this help companies like iRobot better compete in the global marketplace, particularly against companies, and from countries, that aren’t subject to the same regulatory requirements in fast-moving technology segments like robotics.”<\/p>\n

“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\u2014the very things that regulators say they’re trying to protect,” stated Zapolsky.<\/span><\/p>\n

Amazon’s acquisition of iRobot faced multiple hurdles<\/h2>\n

The companies signed the proposed acquisition agreement on Aug. 4, 2022, and the Seattle-based e-commerce giant<\/a> would have acquired the Bedford, Mass.-based robotic vacuum vendor<\/a> for up to $1.7 billion in cash. That amount was lowered<\/a> to $1.42 billion after iRobot acquired new debt, and it laid off<\/a> 10% of its staff, or about 140 employees.<\/p>\n

iRobot tried to reassure customers<\/a> that its plans for mapping consumers’ homes would not result in the sale of private information.<\/p>\n

In September 2022, the U.S. Federal Trade Commission (FTC) launched an investigation<\/a> of Amazon and iRobot’s plans. In October 2022, iRobot and SharkNinja received an initial determination<\/a> in a patent-infringement lawsuit, which ruled in favor of iRobot on two claims and for SharkNinja on two claims affecting<\/a> its top-selling products.<\/p>\n

In April 2023, iRobot got a bit of good news, as the U.K. Competition and Markets Authority cleared<\/a> the proposed acquisition. In September 2023, iRobot introduced<\/a> the Rooma j9+ robot vacuum, the Roombo Combo j9+ robot vacuum and mop, and iRobot OS 7.0.<\/p>\n

In November 2023, the European Commission said that its preliminary view<\/a> was that the acquisition could restrict competition. <\/p>\n

The companies have signed a termination agreement that resolves all outstanding matters from the transaction, including Amazon paying iRobot a previously agreed-upon $94 million termination fee.<\/p>\n

Co-founder Colin Angle steps down as CEO<\/h2>\n

iRobot also announced that co-founder Colin Angle has stepped down as chairman and CEO. He will continue to serve on its board of directors until his current term expires in May 2024<\/span>. Angle has agreed to remain with the company as a senior advisor for up to 12 months.<\/p>\n

“iRobot is an innovation pioneer with a clear vision to make consumer robots a reality,” stated Angle in a release<\/a><\/span>. “The termination of the agreement with Amazon is disappointing, but iRobot now turns toward the future with a focus and commitment to continue building thoughtful robots and intelligent home innovations that make life better, and that our customers around the world love.”<\/p>\n

“When I founded iRobot more than three decades ago, having more than 50 million of our products in homes worldwide was beyond my wildest imagination,” he added. “I am incredibly proud of what our team has accomplished over the years. From the development of the first Roomba in 2002 to our latest generation, they have been relentless in building and delivering new and iconic ways for consumers to clean and live.”<\/p>\n

“At the same time, I know there is a lot of work to do to map iRobot’s next chapter,” noted Angle. “Given the nature of the challenges facing the company, the board and I have mutually decided that iRobot will be better served by a new leader with turnaround experience. I would like to sincerely thank our team members around the world for their commitment to our mission of helping people do more.”<\/p>\n