iRobot Shares Surge Over 19% After News of Acquisition by Amazon
Amazon has recently announced that it is moving forward with the acquisition of iRobot. The e-commerce giant has announced it will be proceeding with the acquisition in an all-cash deal.
Amazon to Acquire Maker of Roomba
Amazon has confirmed that it is proceeding with the acquisition of iRobot. The company is prominently known for being the maker of Roomba.
According to the sources, the deal is set for $1.7 billion. It will be an all-cash deal and it would amount to the mentioned value. Amazon officials made the announcement of acquiring iRobot on Friday.
Reason Behind iRobot Acquisition
Amazon officials have revealed that with the acquisition of iRobot, they want to gain more presence in the consumer robotics sector.
It was last year when Amazon took a bold step in the particular space. It announced the launch of its new product called ‘Astro’ home robot. The price of the particular robot when it launched was $1,449.99.
The particular product is equipped with Alexa digital assistant. The robot is also capable of moving around in the house responding to the voice commands of the consumers.
Amazon Acquired Ring
Amazon has been working hard to introduce many products in the world of robotics. It has introduced many smart home devices.
iRobot is not the first robotics company Amazon has acquired. Back in 2018, Amazon announced that it had acquired Ring. Following the acquisition of Ring, Amazon introduced connected doorbells.
Furthermore, Amazon introduced more devices such as voice-activated microwaves and thermometers.
Remarks by Dave Limp
The hardware devices chief at Amazon, Dave Limp remarked on the performance of iRobot for several years.
Limp admired how iRobot has been performing really well for many years. The company has proven its might in a particular space with a team of highly skilled and capable scientists and manufacturers.
The company has been coming up with very useful and practical devices that are helping consumers in their homes. The devices include robots that collect and empty collection bins automatically.
He stated that the consumers love to use the robots by iRobot and their entire team is glad to work with iRobot teams.
Amazon’s Fourth Largest Deal
The acquisition of iRobot by Amazon is going to be its fourth-largest deal. The largest acquisition recorded for Amazon was for Whole Foods, which was finalized in 2017 for $13.7 billion.
The second largest acquisition of Amazon was for MGM, which was worth $8.45 billion, followed by One Medical for $3.9 billion.
Amazon is acquiring iRobot just when the company is not doing well. It reported a loss of $1.90 per share versus expectations of $1.55 per share. As for the revenue, it reported $255.4 million versus $303 million in estimated revenue.
Following the announcement of the acquisition, iRobot’s shares have recovered 19% while share prices for Amazon have dipped 1%.