The company iRobot, which markets Roomba vacuum cleaner robots, announced Monday the launch of a restructuring plan which should lead to the dismissal of 350 people following the failure of its takeover by the online sales giant Amazon ( GETTY IMAGES NORTH AMERICA/AFP/Archives/JUSTIN SULLIVAN)
The company iRobot, which markets Roomba vacuum robots, announced on Monday the launch of a restructuring plan which should lead to the dismissal of 350 people following the failure of its takeover by the online sales giant Amazon.
A little earlier today, the American group Amazon announced that it was abandoning the operation, not being sure of obtaining approval from the European Commission, which saw a risk of reducing the competition.
“We are disappointed that Amazon cannot complete the acquisition of iRobot,” David Zapolsky, a senior executive at the Amazon group, said in the statement.
“Mergers and acquisitions like this help companies like iRobot better position themselves in the global market,” he added.
“The end of the agreement [d’acquisition] is disappointing, but iRobot is now looking to the future and the desire to develop intelligent robots and innovations that make life better,” said iRobot founder Colin Angle.
In the wake of this first announcement, iRobot unveiled its restructuring plan, which should result in the reduction of nearly a third of its workforce, but also the reduction of 20 million dollars in its research and development expenses.
This plan, which should cost the company between 12 and 13 million dollars, aims to generate between 80 and 100 million in savings.
At the end of September, the company announced a drop of 26.5% in its turnover over the first nine months, after a decline of 24.4% already recorded for the whole of 2022.
For its part, Amazon’s action was spared, ending the session up 1.34%, at $161.13 (AFP/Archives/Kazuhiro NOGI)
After reacting negatively to the failure of the acquisition, the markets calmed down a little regarding the iRobot stock, which still ended down 8.77% to $15.50 on Wall Street. For its part, Amazon’s action was spared, ending the session up 1.34%, to $161.13.
– The industry worries –
The European Commission announced that it would take note of the decision of the two companies.
Quoted in the press release, European Commissioner for Competition Margrethe Vestager recalled that this operation could have “restricted competition in the market for robot vacuum cleaners, leading to higher prices, lower quality and less innovation for consumers” , also believing that the first elements of his investigation pointed in this direction.
At the beginning of July, the Commission announced that it was opening an investigation to determine whether the acquisition would allow Amazon to “restrict competition” and “strengthen its position as an online marketplace provider”.
“Amazon is both an online marketplace and a retailer. We are concerned that by acquiring iRobot, Amazon will use this dual role to prevent iRobot’s competitors from accessing its market,” Ms. Vestager.
iRobot makes robot vacuum cleaners and also sells them on Amazon’s online marketplace.
In a press release, the Computer & Communications Industry Association (CCIA), which represents companies in the sector, expressed concern, through its vice-president for Europe Daniel Friedlaender, about the fact that “if Europe adopted a policy “Regarding acquisitions based on political rather than competitive reasons, this would ultimately lead to less competition and innovation in the EU.”
“It’s bad for the consumer, for choice and for European industry,” he added.
The purchase of Roomba autonomous vacuum cleaners, announced in August 2022, aimed to expand its ambitions in artificial intelligence and smart homes (GETTY IMAGES NORTH AMERICA/AFP/Archives/JUSTIN SULLIVAN)
The purchase of Roomba autonomous vacuum cleaners, announced in August 2022, aimed to expand its ambitions in artificial intelligence and smart homes.
The EU’s announcement came after the British competition regulator had approved the takeover in June 2023.
© 2024 AFP
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