By Dean Seal


Amazon.com and iRobot have agreed to terminate their acquisition deal, citing challenges in gaining regulatory approval in the European Union.

The companies said Monday that they have signed a termination agreement resolving all outstanding matters relating to the transaction.

Amazon will pay iRobot a $94 million termination fee.

The Wall Street Journal reported earlier this month that the European Union's competition watchdog planned to block Amazon's $1.7 billion bid to buy the Roomba maker. The European Commission previously raised concerns that the tie-up would restrict competition in the market for robot vacuum cleaners.

David Zapolsky, Amazon's general counsel, said Monday the company was disappointed with the outcome.

"Undue and disproportionate regulatory hurdles discourage entrepreneurs, who should be able to see acquisition as one path to success, and that hurts both consumers and competition--the very things that regulators say they're trying to protect," Zapolsky said in a statement.

In light of the termination, iRobot is launching a restructuring that will include 350 job cuts, representing about 31% of the company's workforce, and see Colin Angle step down as chief executive and chairman.

Angle said in a statement that he and the board mutually decided "that iRobot will be better served by a new leader with turnaround experience."

Andrew Miller, lead independent director of the board, has been appointed chairman while Chief Legal Officer Glen Weinstein has been tapped to take over as interim CEO while the search for a permanent chief is underway. The board has hired turnaround expert Jeff Engel to be chief restructuring officer.

The headcount cuts are expected to result in $12 million to $13 million in restructuring charges, primarily for severance and related costs, incurred over the first two quarters of the year. Most notifications about the cuts are expected to take place on March 30.


Write to Dean Seal at dean.seal@wsj.com


(END) Dow Jones Newswires

01-29-24 0921ET