EU Sweeps Aside the Amazon-iRobot Deal

January 30, 2024

There’s something rotten about the ease with which European antitrust regulators are nixing U.S. mergers and leveling fines against successful American companies. Case in point – the scuttling of the Amazon purchase of iRobot on Monday.

Like many innovative products, the autonomous Roomba vacuum cleaner pioneered a bold new product line before becoming commoditized. With stiff competition in the robot floor-cleaning line from state-subsidized, Chinese-owned companies, iRobot has been reeling. When Amazon called off the deal after the EU signaled its objection, iRobot shares tumbled by almost 20 percent. The company’s CEO announced his departure and the company announced that it will now lay off almost one-third of its staff.

Putting Amazon’s capital and marketing power behind iRobot could have turbocharged this U.S. company with reach and innovation, to the benefit of consumers in America and Europe.

“Mergers and acquisitions like this help companies like iRobot better compete in the global marketplace, particularly against companies, and from companies, that aren’t subject to the same regulatory requirements in fast-moving technology segments like robotics,” David Zapolsky, Amazon general counsel, told Fortune.

Qui bono? Not the Europeans, who are getting quite comfortable not making things. Not any likely any American upstart, either. The beneficiaries will be Chinese companies like Ecovacs, which will not have to worry about pesky antitrust concerns as long as everyone in management spends two hours a day keeping up with their journaling on Xi Jinping thought.

The European regulators that Lina Khan and other progressive antitrusters want to emulate are little more than Roombas themselves, constantly moving about, getting in the way, with about as much intelligence.