European regulators stated Monday that Amazon’s proposed acquisition of robotic vacuum maker iRobot could hurt competitors.
The European Commission, the European Union’s government arm and high antitrust enforcer, stated it has knowledgeable Amazon of its “preliminary view” relating to the deal following an investigation that started in July.
The information raised traders’ issues in regards to the acquisition, sending shares in Bedford, Massachusetts-based iRobot Corp., most well-known for the circular-shaped Roomba vacuum, down greater than 17% Monday.
The European regulators raised issues that the buyout could hinder iRobot’s rivals from successfully competing on Amazon’s market, which they stated is a vital platform for gross sales of robotic vacuum cleaners in France, Germany, Italy and Spain.
If the deal goes by means of, the fee stated Amazon could also be incentivized to forestall rivals from promoting their merchandise on its market or making it tough for them to take action.
Among different issues, it stated Amazon may scale back the visibility of a competitor’s product on its market or restrict entry to sure labels, equivalent to “Amazon’s choice,” that will appeal to extra customers. It might also discover methods to lift the prices of iRobot’s rivals to promote and promote their merchandise on its platform, the fee stated.
The fee has till Feb. 14 to make a ultimate resolution on the deal. And Amazon could reply to a number of the objections raised.
Alexandra Miller, an Amazon spokesperson, stated the Seattle-based firm is working with the fee and is targeted on addressing its questions.
“IRobot, which faces intense competition from other vacuum cleaner suppliers, offers practical and inventive products,” Miller stated. “We believe Amazon can offer a company like iRobot the resources to accelerate innovation and invest in critical features while lowering prices for consumers.”
Amazon’s acquisition iRobot was introduced final yr for $1.7 billion, however the worth of the deal has since declined by 15% after vacuum maker incurred new debt.
Anti-monopoly organizations have voiced issues in regards to the deal, saying that it will broaden the e-commerce large’s dominance within the good house market.
But British antitrust regulators cleared Amazon’s buy of iRobot again in June. The acquisition continues to be going through a evaluation within the U.S. by the Federal Trade Commission.
Amazon’s inventory completed up lower than 1% Monday.