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<p class="has-drop-cap">According to the Wall Street Journal, the European Union’s (EU) antitrust regulator <a aria-label="intends (opens in a new tab)" href="https://www.wsj.com/tech/eu-commission-intends-to-block-amazons-irobot-acquisition-268a8a1b?st=48wbgm0tpfm485y&amp;reflink=desktopwebshare_permalink" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">intends</a> to block <a href="https://tokenist.com/irbt-jumps-in-premarket-as-amazon-acquisition-reportedly-set-to-be-approved/" rel="noopener noreferrer nofollow" class="deco-link">Amazon’s (NASDAQ: AMZN) $1.7 billion proposal</a> to purchase Roomba maker iRobot (NASDAQ: IRBT). The robot manufacturer’s shares nosedived 37% in premarket trading Friday on the news.</p>
<h3 id="irobot-s-stock-woes-continue">iRobot’s Stock Woes Continue</h3>
<p>Shares of iRobot plummeted over 37% in premarket trading Friday on the reports that its acquisition by Amazon is facing a block from EU competition regulators. The stock was down at $15.27 ahead of the market open.</p>
<p>Notably, the Wall Street Journal reported that the EU’s competition watchdog is set to block Amazon’s $1.7 billion bid to acquire iRobot. The report comes a day after European Commission’s competition officials met with Amazon’s representative to discuss the proposal. The e-commerce and cloud giant was informed that the deal would likely be obstructed.&nbsp;</p>
<p>The premarket dip represents the latest in a series of setbacks for iRobot’s stock market performance. The company lost more than 50% of its value over the past six months, with a portion of those declines occurring when the European Commission <a aria-label="warned in November (opens in a new tab)" href="https://www.cnbc.com/2023/11/27/irobot-irbt-drops-18percent-after-eu-warns-amazon-deal-may-hurt-competition.html#:~:text=iRobot%20shares%20plunged%20Monday%20after,access%20to%20its%20online%20site." target="_blank" rel="noopener noreferrer nofollow" class="deco-link">warned in November</a> that the deal could raise competition concerns.</p>
<p>Amazon’s shares rose slightly higher in the market pre-open. Last year, the company <a href="https://tokenist.com/amazons-shares-gain-as-4b-deal-with-ai-firm-anthropic-announced/" rel="noopener noreferrer nofollow" class="deco-link">announced a $4 billion investment</a> in AI firm Anthropic.</p>
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<h3 id="amazon-irobot-deal-overview">Amazon-iRobot Deal Overview</h3>
<p>Amazon first announced its intention to acquire iRobot in August 2022 at $61 per share in an all-cash transaction.&nbsp;</p>
<p>In July 2023, the EC opened an investigation into the deal, expressing concerns about potential anti-competitive practices. The regulator cautioned that Amazon’s acquisition could impede iRobot’s competitors by limiting their visibility on the online marketplace. The EC argued that this includes the possibility of delisting or reducing the visibility of rival products in search results and other areas.&nbsp;</p>
<p>However, a formal approval from the commission’s 27 top political leaders is still required to reject the deal officially. Typically, this process is unlikely to override a recommendation from the bloc’s competition commissioner, Margrethe Vestager.&nbsp;</p>
<p>The final decision must be reached by February 14, per the commission’s deadline.</p>
<p>Politico recently reported that Amazon does not intend to provide concessions to address the concerns raised by the EC regarding the acquisition. Meanwhile, the U.S. <a aria-label="Federal Trade Commission (opens in a new tab)" href="https://www.wsj.com/tech/ftc-sues-amazon-alleging-illegal-online-marketplace-monopoly-6bd9af23" target="_blank" rel="noopener noreferrer nofollow" class="deco-link">Federal Trade Commission</a> is still reviewing the deal. In June, the U.K.’s Competition and Markets Authority stated that the acquisition would not significantly reduce competition in the U.K.</p> <iframe src="https://tokenist.substack.com/embed" width="100%" height="320" style="border:1px solid #EEE; background:white;" frameborder="0" scrolling="no"></iframe>
<p><em><strong>How far can iRobot’s share price tumble if the deal gets officially blocked? Let us know in the comments below.&nbsp;</strong></em></p>
<p><em>Disclaimer: The author does not hold or have a position in any securities discussed in the article.</em></p>
<p>The post <a rel="noopener noreferrer nofollow" href="https://tokenist.com/irobot-stock-drops-35-in-premarket-after-amazon-deal-likely-to-be-blocked/">iRobot Stock Drops 35% in Premarket After Amazon Deal Likely to Be Blocked</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://tokenist.com">Tokenist</a>.</p>

iRobot Stock Drops 35% in Premarket After Amazon Deal Likely to Be Blocked

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