Finance & Economics

Amazon’s $1.7 Billion iRobot Deal Gets UK Clearance

Amazon has received permission from the UK Antitrust Agency to implement a deal with iRobot, a company that manufactures robot vacuum cleaners.

Amazon’s $1.7 Billion iRobot Deal Gets UK Clearance

The cost of the deal for the retailer to acquire a manufacturer of vacuum cleaners engaged in cleaning premises without the need for human intervention is $1.7 billion.

The British Competition and Markets Authority (CMA) stated that the implementation of this transaction will not cause problems with competition in the UK. The corresponding conclusion was made by the regulator following an initial review of the intentions of the e-commerce giant to acquire a manufacturer of robot vacuum cleaners. This information is contained in the statement of the Competition and Markets Authority, which was published on Friday, June 16.

For the first time, the plan of the e-commerce giant to acquire iRobot was announced in August last year. Technology advocacy groups, upon learning of the intention to implement this transaction, said that in this case there are risks related to competition and confidentiality. They also noted that the e-commerce giant is seeking to increase the number of devices connected to the Internet in people’s homes.

In the near future, this transaction will be studied in detail by the US Federal Trade Commission. Also, the prospects and potential consequences of the retailer’s purchase of a manufacturer of robot vacuum cleaners will be considered by the European Commission.

Currently, iRobot’s positions in the British market are not dominant and do not create a reason for asserting leadership. In the UK, the company is in a situation of competitive confrontation with many firms. The implementation of the deal may affect this state of affairs and improve iRobot’s position, but if such a forecast comes true, then the changes will not be significant and global in the context of the balance of power in the British market.

Amazon’s competing smart home platforms, following the results of the transaction, will also not find themselves in a situation of limited opportunities for market promotion and competition.

Colin Raftery, senior director of mergers at CMA, said that after careful consideration of all the likely consequences of the acquisition of iRobot by the e-commerce giant, it was concluded that this business agreement would not cause a violation of the competition process on the UK market.

Of particular note is the fact that Amazon received approval at a time when the CMA adheres to a very tough position regarding large deals in the technology sector. In April, the regulator did not give its consent to the purchase of Microsoft Activision Blizzard. The value of this transaction was estimated at $ 69 billion. Also, the regulator did not approve the purchase of Giphy Meta Platforms last year.

Amazon is facing separate probes by the British authorities, including an AWS cloud business investigation and another CMA investigation into Amazon Marketplace.

As we have reported earlier, Amazon to Pay $30.8 Million to Settle FTC Privacy Claims.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.