Amazon has announced that it will cancel its planned acquisition of Roomba maker iRobot Inc. The Amazon-Irobot deal has been a hot topic since it was announced in July 2022, and the EU has been preparing to block the acquisition on the grounds that it could cause Amazon to delist or lower the profile of rival robot vacuum cleaners in its marketplace.

The European Commission, the EU's enforcement arm, stepped in aggressively to prevent Amazon from gaining too much control over the marketplace. Regulatory reviews repeatedly lowered the acquisition price from its original valuation of $1.7 billion until the deal was finally scrapped today. The merger would have provided a significant boost to Amazon's research and development efforts with its foray into robotics and the framework of its existing Alexa smart home platform. iRobot manufactures products such as air purifiers and robotic lawn mowers.

Unfortunately, the deal fell through, and iRobot's stock price has already been affected, falling 10% this morning. Amazon will pay iRobot a $94 million contract termination fee, iRobot will lay off 31% of its workforce (350 employees), and Chairman and CEO Colin Angle will step down effective immediately.

Amazon is no stranger to acquisitions; between 2017 and 2019, Amazon acquired Blink, Ring, and Eero, bringing their products into the Alexa smart home. These mergers went smoothly, and Amazon still sells the best security cameras from competitors like Arlo and Eufy, as well as mesh Wi-Fi systems from rivals.