[ad_1]
The outcome of Amazon.com Inc’s proposed takeover of iRobot Corp has left many anxious. The worries come after a competition warning from Europe’s antitrust watchdog cast doubts on the deal’s path to closing. The robot-vacuum maker’s stock was whipsawed this week and now trades more than 30% below Amazon’s $51.75-per-share offer Tuesday.
What’s causing the worry
The European Commissionin Brussels smashed hopes for a straightforward approval in the region after issuing a so-called statement of objections.According to a report in Bloomberg, the outlook for iRobot without an Amazon deal is bleak. The indebted Roomba maker has reportedly seen revenue stall this year following a pandemic boom. The stock has been on a downward trajectory since July, when iRobot agreed on a lower offer price after getting fresh financing.
What is further worrying the traders is that the concerns raised by the European Commission raises the likelihood of the Federal Trade Commission (FTC) challenging the deal in the US. The US agency’s probe into the transaction since last year over competition concerns is the main risk. Meanwhile, the FTC is pursuing a separate antitrust lawsuit against Amazon accusing the retailer of dominating the online marketplace.
How there may still be hope for iRobot
While the European regulator’s warning is not a final decision and could be addressed with remedies proposed by the companies. The European Commission currently has a deadline of February 14 to decide whether to approve the deal with concessions or to block it. Elsewhere, the UK watchdog has cleared the merger in June.
Incidentally, reports in news agency Reuters claim that European Commission lawyers initially opposed sending a warning to Amazon over its $1.4 billion acquisition of robot vacuum maker iRobot. The Commission’s legal service did not think a statement of objections regarding the deal was warranted, in contrast with antitrust officials handling the case. Without such a charge sheet, the deal would have been cleared unconditionally.
The lawyers subsequently changed their mind and backed antitrust officials’ decision to send the charge sheet setting out their concerns. While Amazon might still gain unconditional approval to buy iRobot, the charge sheet indicates that officials are looking for remedies from the company to address their concerns.
The case is said to echo that of Google which only won the EU green light to buy Fitbit in 2020 after agreeing to restrictions on how it will use customers’ health-related data.
What’s causing the worry
The European Commissionin Brussels smashed hopes for a straightforward approval in the region after issuing a so-called statement of objections.According to a report in Bloomberg, the outlook for iRobot without an Amazon deal is bleak. The indebted Roomba maker has reportedly seen revenue stall this year following a pandemic boom. The stock has been on a downward trajectory since July, when iRobot agreed on a lower offer price after getting fresh financing.
What is further worrying the traders is that the concerns raised by the European Commission raises the likelihood of the Federal Trade Commission (FTC) challenging the deal in the US. The US agency’s probe into the transaction since last year over competition concerns is the main risk. Meanwhile, the FTC is pursuing a separate antitrust lawsuit against Amazon accusing the retailer of dominating the online marketplace.
How there may still be hope for iRobot
While the European regulator’s warning is not a final decision and could be addressed with remedies proposed by the companies. The European Commission currently has a deadline of February 14 to decide whether to approve the deal with concessions or to block it. Elsewhere, the UK watchdog has cleared the merger in June.
Incidentally, reports in news agency Reuters claim that European Commission lawyers initially opposed sending a warning to Amazon over its $1.4 billion acquisition of robot vacuum maker iRobot. The Commission’s legal service did not think a statement of objections regarding the deal was warranted, in contrast with antitrust officials handling the case. Without such a charge sheet, the deal would have been cleared unconditionally.
The lawyers subsequently changed their mind and backed antitrust officials’ decision to send the charge sheet setting out their concerns. While Amazon might still gain unconditional approval to buy iRobot, the charge sheet indicates that officials are looking for remedies from the company to address their concerns.
The case is said to echo that of Google which only won the EU green light to buy Fitbit in 2020 after agreeing to restrictions on how it will use customers’ health-related data.
[ad_2]
Source link
More Stories
Google Maps: Three privacy features coming to Google Maps on Android, iPhones
Most-Downloaded IPhone App: This Chinese app was the most-downloaded iPhone app in the US in 2023
Ukraine’s largest mobile operator goes offline for millions of users after cyber attack