EU Raises Concerns Over Amazon's $1.7 Billion iRobot Deal, Citing Potential Competition Issues.

Key Highlights:

European Union regulators have raised concerns over Amazon's proposed $1.7 billion acquisition of iRobot, the maker of Roomba vacuum cleaners. The European Commission has communicated its initial view that the acquisition may limit competition in the robot vacuum cleaner market.

Amazon had announced its intention to acquire iRobot in August 2022. The European Commission initiated an investigation in July 2023, while British regulators cleared the deal in June. The Federal Trade Commission also sought information from Amazon and iRobot in September 2022.

Dive Insight:

The European Commission has unexpectedly expressed objections to Amazon's planned acquisition of iRobot, a move that contradicts earlier expectations of unconditional approval. The objection statement suggests concerns about potential restrictions on competition in the robot vacuum cleaner market.

According to the Commission, there is apprehension that Amazon, through its acquisition of iRobot, could wield the "ability and incentive to foreclose iRobot’s rivals." This could manifest as actions like delisting competitor robot vacuum cleaners or diminishing their visibility on the Amazon marketplace. Amazon has the opportunity to respond to these objections and may request an oral hearing in the process. A final decision from the Commission regarding the deal is expected by February 14th, 2024.

Amazon spokesperson Alexandra Miller addressed the Commission's concerns, stating, "We continue to work through the process with the European Commission and are focused on addressing its questions and any identified concerns at this stage." Miller emphasized that iRobot faced substantial competition in the vacuum cleaner market and highlighted Amazon's potential to provide resources for innovation, investment, and lower prices for consumers.

The European Commission's objections introduce a layer of complexity to the acquisition, raising questions about its impact on market dynamics and competition. As the regulatory process unfolds, Amazon's responses and any potential adjustments to the deal will be crucial factors in determining its final outcome.



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