(Portal) – The European Union's competition regulator plans to block Amazon.com's $1.4 billion acquisition of robot vacuum cleaner maker iRobot, the Wall Street Journal said on Thursday, citing people familiar with the matter.
Shares of the Roomba vacuum cleaner plunged more than 36% in premarket trading on Friday.
WSJ reported that Amazon was informed during its meeting with European Commission officials on Thursday that the deal would likely be rejected.
Amazon declined to comment on the report.
According to an update on the European Commission's website, the U.S. tech giant did not offer any remedies by the Jan. 10 deadline to address antitrust regulators' concerns that the deal could limit competition in the robot vacuum cleaner market.
“If the goal is to create more competition in home robotics, that doesn’t make sense,” said Matt Schruers, president of the technology lobbying group Computer and Communications Industry Association.
“Blocking this deal could leave consumers with fewer options, and regulators cannot sweep this fact under the rug,” Schruers added.
Roomba robot vacuum cleaner from iRobot at a Bed Bath and Beyond store in Larkspur, California. (Justin Sullivan/Getty Images) (Justin Sullivan via Getty Images)
The e-commerce giant announced its plans to purchase iRobot in August 2022 to expand its portfolio of smart devices, which includes Alexa voice assistant, smart thermostats, security devices and wall-mounted smart displays.
The European Commission, which acts as the EU's competition watchdog, has until February 14 to either approve or reject the deal.
(Reporting by Harshita Mary Varghese and Chavi Mehta in Bengaluru; Foo Yun Chee in Brussels)