Amazon.com will acquire iRobot Corp, maker of the robotic vacuum cleaner Roomba, in an all-cash deal for about $1.7 billion in the latest push by the world’s largest online retailer to expand its stable of smart home devices.
Amazon will pay $61 per share, valuing iRobot at a premium of 22% to the stock’s last closing price of $49.99.
iRobot’s stock rose 19% in Friday trading to $59.66. At its peak during Covid-19 pandemic lockdowns, iRobot shares were more than twice that price as hygiene-conscious consumers invested in premium vacuum cleaners.
The acquisition follows through on a vision that Amazon outlined in 2021. Amazon Senior Vice President Dave Limp told reporters, “in five to 10 years, we believe every home will have at least one robot that will become a core part of your everyday life.”
iRobot Chief Executive Colin Angle likewise has said homes should have myriad devices that seamlessly communicate with each other and one day address social challenges such as eldercare.
Amazon’s devices unit only makes up a fraction of company revenue, but the e-commerce giant has steadily expanded its line-up with more speakers showcasing its Alexa voice assistant and with home security doorbells and cameras from Ring, which it acquired in 2018.
Ethan Glass, an antitrust expert with law firm Cooley LLP, said the US Federal Trade Commission would likely review the transaction.
Published in The Express Tribune, August 7th, 2022.
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