The manufacturer of the popular Roomba robotic vacuum cleaner, iRobot, has filed for Chapter 11 bankruptcy in the US, succumbing to intense pressure from more affordable competitors.
The move is part of a restructuring plan that will see Shenzhen-based Picea Robotics, which serves as iRobot’s primary supplier and lender, acquire all outstanding shares in the company.
This development follows the collapse of Amazon’s proposed £1.3 billion takeover of iRobot in January of last year.
The e-commerce giant had agreed to the acquisition in August 2022, but the deal faced significant opposition from EU competition regulators.
The European Commission expressed concerns that the merger could harm competition for rival products on Amazon’s online marketplace, specifically citing potential negative impacts in France, Germany, Italy, and Spain.
Their investigation concluded that Amazon might reduce the visibility of competitor products should the acquisition have proceeded.
Gary Cohen, chief executive of iRobot, said: “Today’s announcement marks a pivotal milestone in securing iRobot’s long-term future.
“The transaction will strengthen our financial position and will help deliver continuity for our consumers, customers and partners.
“Together, we will work to continue advancing the industry-leading Roomba robots and smart home technologies that have defined the iRobot brand for more than three decades.
“By combining iRobot’s innovation, consumer-driven design, and research and development with Picea’s history of innovation, manufacturing and technical expertise, we believe iRobot will be well equipped to shape the next era of smart home robotics.”
Massachusetts-based iRobot has been knocked by competition from cheaper Chinese rivals, as well as surging US tariffs, which have seen import levies increased to 46% on goods from Vietnam, where most of its products are made for the US.
The firm launched its first Roomba robot vacuum in 2002 and has since gone on to sell millions of robots worldwide.
It is best known for its robotic vacuums, but also develops smart-home technologies and advanced concepts in cleaning, mapping and navigation.
Picea is a global manufacturer and service provider of robotic vacuum cleaners, with research and development and manufacturing facilities in China and Vietnam.
It has has some 7,000 employees globally and has sold more than 20 million robotic vacuum cleaners.
