iRobot Files for Bankruptcy After Roomba Success
▼ Summary
– iRobot, the maker of Roomba, has filed for Chapter 11 bankruptcy and will be acquired by its Chinese supplier and lender, Picea Robotics.
– The company’s struggles are attributed to intense competition from cheaper rivals in the robot vacuum market.
– This deal follows the collapse of a proposed $1.5 billion acquisition by Amazon nearly two years ago, which was blocked by EU regulators.
– iRobot’s current share price is drastically lower than the price Amazon had offered to pay for the company.
– Founded in 1990, iRobot pioneered home robotics and has sold over 40 million devices, including its iconic Roomba vacuum cleaner.
The company that brought robot vacuums into millions of homes has reached a critical juncture. iRobot, the pioneering maker of the Roomba, has filed for Chapter 11 bankruptcy protection. This move is part of a restructuring agreement that will see the firm acquired by its primary supplier, China-based Picea Robotics. The development underscores the intense competitive pressures from lower-cost rivals that have reshaped the market iRobot once dominated.
The US-listed group announced the filing in Delaware on Sunday. The agreement with Picea Robotics, which is also iRobot’s lender, involves the acquisition of all the company’s outstanding shares. This deal arrives nearly two years after a proposed $1.5 billion takeover by Amazon collapsed. That acquisition was blocked by European Union regulators who raised significant antitrust concerns. The current share price reflects the company’s struggles, trading at approximately four dollars, a stark contrast to the fifty-two dollars per share Amazon had offered.
iRobot’s chief executive, Gary Cohen, framed the announcement as a necessary step forward. He stated that the transaction represents a pivotal milestone for securing the company’s long-term future. Cohen emphasized that the move will strengthen iRobot’s financial footing and help ensure continuity for its consumers, retail partners, and broader network of stakeholders.
Founded over three decades ago by a team of engineers from MIT, iRobot played a foundational role in introducing practical robotics to the consumer market. The company’s most famous product, the Roomba autonomous vacuum cleaner, became a cultural icon and a staple in modern homes. According to the firm’s own data, it has sold more than forty million devices worldwide, cementing its legacy as an early innovator in smart home technology.
(Source: Ars Technica)
