Amazon’s $1.4bn acquisition of robot vacuum maker iRobot is set to gain EU antitrust approval, Reuters reported on Thursday (23 November).
In July, the European Commission opened an investigation to assess the proposed acquisition under the EU Merger Regulation, expressing concern that the transaction would allow the tech and retail giant to restrict competition in the robot vacuum cleaner (RVC) market, while strengthening its position as an online marketplace provider.
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The Commission noted that Amazon’s online marketplace is already a key channel for RCV sales in several EU member states. In light of this, the acquisition could incentivise and enable Amazon to restrict or downgrade iRobot’s rivals access to the marketplace, leading to less competition, higher prices, lower quality, and less innovation for consumers.
Another concern was that Amazon would obtain access to iRobot’s users’ data, giving the company an advantage in data-related markets and advertising rankings.
In late October, the EU’s antitrust regulators moved the deadline for its decision on the deal from 13 December 2023 to 14 February 2024, due to insufficient information provided by the companies.
The proposed acquisition has already been given the green light by the UK’s Competition and Markets Authority (CMA) – a promising sign after the watchdog controversially blocked Microsoft’s acquisition of Activision Blizzard back in April.
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By GlobalDataThe CMA said that the deal would not lead to competition concerns in the UK, noting that Amazon has no incentive to restrict iRobot rivals’ access to its online marketplace due to the lost sales commissions and reduced advertising revenues it would thereby incur. It also noted that iRobot’s UK market position in RCVs is “modest” and already faces significant competition.
If cleared, iRobot will join Amazon’s extensive portfolio of smart home products, which includes Amazon Alexa, Amazon Echo and Ring, and will enhance its presence in the consumer robotics category, which includes the home security tool Astro Robot.
