IRBT Jumps in Premarket as Amazon Acquisition Reportedly Set to Be Approved

Reuters reported on Thursday that Amazon (NASDAQ: AMZN) will likely secure a green light from the European Union (EU) antitrust regulators to proceed with its $1.4 billion acquisition of iRobot (NASDAQ: IRBT). The robot maker’s shares jumped nearly 30% in today’s premarket trading. 

Amazon to Win ‘Unconditional’ Approval for iRobot Takeover After Antitrust Scrutiny: Report

The maker of consumer robots iRobot saw its stock price soar higher in premarket trading on Friday after Reuters reported that EU regulators are set to approve its acquisition by Amazon. The Nasdaq-listed stock was up more than 29% at the time of writing. 

According to three sources with knowledge of the matter, the Reuters report said that Amazon’s $1.4 billion buyout of iRobot will obtain unconditional authorization by EU antitrust watchdogs. The European Commission, the bloc’s principal competition regulator, must decide on the deal by February 14. 

The proposed acquisition came under scrutiny earlier in the year. Brussels raised concerns that it may affect competition for smart vacuum cleaners and increase Amazon’s dominance as an online marketplace provider. The position echoed recent skepticism among other competition authorities that new tie-ups between Big Tech giants and smaller players could lead to large customer data troves being controlled by a small mix of companies.

Amazon’s stock price remained flat in the market pre-open.

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Amazon’s Plans to Acquire iRobot

Amazon’s plans to acquire iRobot were announced in August 2022 as a part of the e-commerce behemoth’s to expand its presence in the consumer robotics space.

The company’s all-cash offer initially valued iRobot at $1.7 billion, or $61 per share, but that bid was slashed later by 15% after iRobot incurred fresh debt. 

The deal will see iRobot’s flagship Roomba and other cleaning devices, such as robotic mops and air purifiers, join a portfolio of Amazon’s smart home devices, including Ring doorbells and Alexa. Further, iRobot also developed an educational robot, Root, designed to help children learn coding. 

Amazon already forayed deeper into consumer robotics last year when it unveiled the Astro home robot, an Alexa-equipped $1,449 device that can follow consumers around their homes. Among other deals, the e-commerce firm also invested $4 billion in AI startup Anthropic this year.

Last month, the tech company reported its latest quarterly earnings that beat Wall Street’s estimates on top and bottom lines, driven by strong growth in its digital ad business. 

Do you expect a significant movement in Amazon’s stock price after the iRobot deal approval? Let us know in the comments below.