EU regulators say Amazon鈥檚 acquisition of vacuum maker iRobot may harm competition
Nov 27, 2023, 4:05 PM
European regulators said Monday that Amazon鈥檚聽聽of robot vacuum maker iRobot may harm competition.
The European Commission, the European Union鈥檚 executive arm and top antitrust enforcer, said it has informed Amazon of its 鈥減reliminary view鈥� regarding the deal following an investigation that began in July.
The news raised investors鈥� concerns about the acquisition, sending shares in Bedford, Massachusetts-based iRobot Corp., most famous for the circular-shaped Roomba vacuum, down more than 17% Monday.
The European regulators raised concerns that the buyout may hinder iRobot鈥檚 rivals from effectively competing on Amazon鈥檚 marketplace, which they said is an important platform for sales of robot vacuum cleaners in France, Germany, Italy and Spain.
If the deal goes through, the commission said Amazon may be incentivized to prevent competitors from selling their products on its marketplace or making it difficult for them to do so.
Among other things, it said Amazon could reduce the visibility of a competitor鈥檚 product on its marketplace or limit access to certain labels, such as 鈥淎mazon鈥檚 choice,鈥� that may attract more shoppers. It may also find ways to raise the costs of iRobot鈥檚 rivals to advertise and sell their products on its platform, the commission said.
The commission has until Feb. 14 to make a final decision on the deal. And Amazon may respond to some of the objections raised.
Alexandra Miller, an Amazon spokesperson, said the Seattle-based company is working with the commission and is focused on addressing its questions.
鈥淚Robot, which faces intense competition from other vacuum cleaner suppliers, offers practical and inventive products,鈥� Miller said. 鈥淲e believe Amazon can offer a company like iRobot the resources to accelerate innovation and invest in critical features while lowering prices for consumers.鈥�
Amazon鈥檚 acquisition iRobot was announced last year for $1.7 billion, but the value of the deal has since declined by 15% after vacuum maker聽.
Anti-monopoly organizations have voiced concerns about the deal, saying that it would broaden the e-commerce giant鈥檚 dominance in the smart home market.
But British antitrust regulators聽聽of iRobot back in June. The acquisition is still聽聽in the U.S. by the Federal Trade Commission.
Amazon鈥檚 stock finished up less than 1% Monday.
