Britain’s Competition and Markets Authority has given Amazon the go-ahead light to acquire iRobot Corp.
The Authority said it was satisfied that iRobot has enough strong rivals in the market and that the $1.7 billion merger would not harm competition.
iRobot is best known for its Roomba robotic vacuum cleaners and has a history of making customers’ lives easier with innovative cleaning products for the home.
iRobot has continued to innovate with every product generation, solving hard problems to help give customers valuable time back in their day.
The CMA opened its investigation in April to see if the acquisition could result in “a substantial lessening of competition within any markets in the United Kingdom for goods or services.”
Shares of iRobot rose 19% on Friday after news of the acquisition by Amazon’s approval became public.
“The CMA considered whether, following the merger, the merged entity would be able to disadvantage, or foreclose, rival smart home platforms, by limiting their access to iRobot,” the authority wrote in a summary of its decision.
The authority concluded that it would not need to move into a Phase 2 investigation on potential harm to competition.
“The CMA has considered whether, if the merger had not gone ahead, Amazon could have entered the RVC market with its own product, which could have competed against iRobot, and whether, if so, any competition lost between iRobot and Amazon as a result of the merger could have been substantial,” the authority said.
The CMA ultimately then decided that “even if Amazon would have entered the U.K. RVC market absent the merger there would in any event be sufficient remaining constraints to ensure that the merger does not give rise to competition concerns.”
“The CMA has found, in light of Amazon’s broader business strategy and ongoing product development activities, that there was a realistic prospect that Amazon would have started to supply its own RVC product absent the merger,” the authority found.
The existence of strong competition in the robotic vacuum cleaner industry was a key factor in the authority’s decision.
“The CMA also found, however, that iRobot’s market position in the U.K. is modest and that it already faces several significant competitors (including Ecovacs and Eufy, both of which have a higher market share than iRobot, as well as Roborock, Samsung and Dyson),” the Authority said.
