Competition and Markets Authority (CMA) of the United Kingdom has announced that it is evaluating Amazon’s billion-dollar purchase of iRobot, a manufacturer of robot vacuums.
The investigation is still in its earliest conceivable stage. At this point, the CMA is simply seeking feedback from key stakeholders to determine whether or not there may be a “substantial lessening of competition” in the United Kingdom due to Amazon’s purchase of iRobot.
The Competition and Markets Authority (CMA) has yet to establish any particular timetables or dates for when it would declare whether or not it will proceed with an official inquiry.
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Who Is iRobot & Why Is Amazon Interested?
iRobot is most known for its Roomba-branded autonomous vacuum cleaners. However, the company also produces tangential devices capable of mopping floors.iRobot was first established at the Massachusetts Institute of Technology almost thirty years ago.
With Amazon’s Irobot progressive entry into the smart home, as well as the business’s dabblings in home robotics, including integrations with Roombas, it wasn’t that big of a surprise that iRobot would be a compelling prospect for Amazon, which is why the company made an offer of $1.7 billion to purchase the publicly listed company in August. However, given the background of increasing regulatory scrutiny in the big IT industry, it was likely inevitable that the megabucks purchase would attract the attention of authorities all over the world.
The Claims of The EU Authorities
It has been claimed that EU authorities are getting ready to probe Amazon’s purchase of iRobot on privacy grounds. This is due to worries over how Amazon may merge data from the two firms to obtain a competitive edge. Meanwhile, Amazon is already under scrutiny by the authorities in its home market, America, as part of a multi-pronged inquiry spanning various topics, including acquisitions, competition, privacy, and more. Although the Federal Trade Commission (FTC) is considering opening an official inquiry into Amazon’s acquisition of iRobot, it should be noted that the FTC approved the company to purchase One Medical for $3.9 billion.
Other Companies Under The UK Government’s Scrutiny
Concerning the United Kingdom, there are now several antitrust transactions that need to be resolved. Just the other day, the government agency Ofcom said that it was getting ready to send the cloud infrastructure market in the United Kingdom to an in-depth inquiry, with a particular emphasis on Amazon Web Services (AWS) and Microsoft. The CMA is also watching Broadcom’s proposed acquisition of VMware, valued at $61 billion, and Microsoft’s gargantuan offer to purchase Activision for $68.7 billion. And around 18 months ago, the CMA issued an order mandating that Facebook’s parent company, Meta, liquidate its ownership in Giphy, which it had purchased for $400 million the year before.
Even while this investigation may not necessarily suggest that Amazon’s agreement to acquire iRobot is in jeopardy, it is evident that the United Kingdom has an appetite for investigating the merger and acquisition activities of large technology companies. It would not be excessively shocking if the United Kingdom decided to initiate an official probe, given that authorities in the European Union and the United States are also considering conducting an in-depth examination.
According to a statement made by a spokeswoman for Amazon, the business is “working cooperatively with the relevant regulators in their review of the merger.” The spokesperson also said consumers “have several options when purchasing a vacuum.”
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Feature Image Source: Amazon