AMZN.O, Amazon, opens a new tab EU antitrust regulators will prohibit the $1.4 billion acquisition of robot vacuum firm iRobot (IRBT.O), according to three persons with knowledge of the situation, who made the announcement on Friday. This comes as enforcers increase their scrutiny of Big Tech mergers.
The European Commission warned last week that the agreement would limit competition in the market for robot vacuum cleaners. However, the US online retail behemoth disregarded the warning by refusing to provide remedies to allay these fears.
Both Amazon and the Commission, which must make a decision on the merger by February 14th, declined to comment.
The regulator’s primary worries were that Amazon may use its online marketplace to sabotage competitors of iRobot, particularly in France, Germany, Italy, and Spain.
Although the recently imposed EU tech regulations known as the Digital Markets Act may solve this, one of the sources stated that the Commission believes it is preferable to block the merger now due to the lengthy enforcement process and the fact that the new legislation has not yet been challenged in court.
A veto would increase the bar for Amazon’s future acquisitions of online competitors, as EU antitrust authorities would probably require significant remedies in exchange for their approval.
