iRobot's desperate search for a buyer just hit a wall. The Roomba maker's stock crashed over 30% Monday after its last remaining potential acquirer walked away from months of exclusive negotiations, leaving the company staring down potential bankruptcy with debts mounting and cash running dry since Amazon's abandoned $1.7 billion deal collapsed.
The Roomba just hit its biggest obstacle yet. iRobot shares cratered more than 30% Monday after the company disclosed its months-long hunt for a buyer has essentially collapsed, with its final potential acquirer walking away and bankruptcy protection now a real possibility.
The robotic vacuum maker has been scrambling to find a lifeline since March, but last week delivered crushing news to investors. Its only remaining bidder withdrew after what iRobot called "a lengthy period of exclusive negotiations," according to a regulatory filing that sent shockwaves through the consumer robotics industry.
The company's desperation is palpable in its latest disclosure. "We currently are not in advanced negotiations with any alternative counterparties to a potential sale or strategic transaction," iRobot warned investors. "As such, there remains no assurance that our review of strategic alternatives will result in any transaction or outcome."
This nightmare scenario traces back to Amazon's abandoned $1.7 billion acquisition attempt. The e-commerce giant walked away from the deal in January 2024 after regulatory pushback, leaving iRobot financially exposed and struggling to service its debts. What was supposed to be iRobot's salvation became its undoing.
Amazon CEO Andy Jassy didn't mince words about regulators torpedoing the deal. He called it "a sad story" during an earnings call, arguing the acquisition would have helped iRobot scale against rapidly growing Chinese rivals like Anker, Ecovacs, and Roborock that are eating into its market share.
The numbers paint a grim picture. iRobot's stock has plummeted over 50% this year, and the company's last remaining bidder offered a price "significantly lower" than recent trading levels. The company took a $200 million emergency loan from Carlyle Group in July 2023 as a stopgap measure, expecting the Amazon deal to close and provide financial relief.
Now that lifeline is stretched to its breaking point. iRobot just secured its sixth amendment to the credit agreement, extending the waiver period for certain financial obligations until December 1st. It's a temporary bandage on what appears to be a fatal wound.
