iRobot Stock Soars as U.K. Regulator Approves Amazon's Acquisition

iRobot Stock Soars as U.K. Regulator Approves Amazon's Acquisition

June 19, 2023 : Amazon’s planned acquisition of iRobot, the renowned manufacturer of Roomba vacuums, has received approval from Britain’s competition watchdog, the Competition and Markets Authority (CMA). After conducting an investigation since April, the CMA concluded that the $1.7 billion deal would not result in a significant reduction in competition within the United Kingdom.

Upon hearing the news of the CMA’s decision, iRobot’s stock experienced a remarkable surge of 21%. Conversely, Amazon’s shares closed down 1%. An Amazon spokesperson expressed satisfaction with the CMA’s ruling, stating that they are content with the decision and remain committed to supporting regulatory bodies. They also expressed anticipation for similar approvals from other regulators in the near future.

Last year, Amazon announced its intention to acquire iRobot as part of its strategic plan to further establish its presence in the smart home industry. However, the deal is still undergoing review by the U.S. Federal Trade Commission and European Union antitrust regulators, who initiated their investigation earlier this month.

In its review, the CMA found that iRobot holds a modest market position in the United Kingdom and faces significant competition from various rivals. The authority also determined that the acquisition would not impede the ability of competing smart home platforms to engage in fair competition. Furthermore, the CMA found no compelling evidence suggesting that Amazon would favor iRobot’s products on its online store.

While the acquisition has cleared a significant hurdle in the U.K., further evaluations by regulatory bodies are required before the deal can be finalized. As the review processes continue in the United States and the European Union, both Amazon and iRobot await decisions from the respective authorities.