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IRBT.US
id: 1136

iRobot Corporation (IRBT) Amazon Merger Cancellation Case

D. New Jersey
Court
2:24-CV-02138
Case number
05 Aug 2022
Class period Start
26 Jan 2024
Class period End
07 May 2024
Lead Plaintiff motion deadline
  • $IRBT stockholder filed a claim vs. iRobot over failed merger with Amazon and the antitrust issues associated with it.
  • In January 2024, news of the merger cancellation caused $IRBT to fall 8%, losing $41M+ in shareholder value.
In August 2022, iRobot and Amazon announced a merger deal. Amazon planned to buy iRobot for $61 per share in cash, totaling about $1.7B including iRobot's debt.

On June 22, 2023, news reported that the European Commission would look into the merger. As a result, $IRBT dropped by over 8%.

Later, the EC informed Amazon that its plan to buy iRobot might limit competition for robot vacuum cleaners.

On January 10, 2024, it was reported that Amazon didn't make any offers to address the European Commission's worries about the merger. On this news, $IRBT dropped by almost 20%.

Then Bloomberg reported that the U.S. FTC was preparing to sue to stop the merger.

After that, on January 29, 2024, Amazon and iRobot mutually agreed to cancel their merger.
  • Additionally, iRobot's CEO and Chairman resigned, and the company announced plans to cut about 31% of its workforce.
As a result, $IRBT dropped by nearly 9%.

Based on these events, $IRBT stockholder filed a claim against iRobot and its leaders, accusing them of the following:
  • Merger would give Amazon a dominant position in the RVC market, making approval by U.S. and European antitrust regulators unlikely.
  • iRobot overstated the likelihood of successfully completing the merger.
Considering all the representations, investors have reasons to suspect that iRobot's due diligence for the merger was inadequate and overstated its prospects.
Alleged Offence
Mismanagement
Misleading Statements
Omissions
Suspected Party
Directors
Management
Security Type
Stocks
Trade Direction
Long
Shock Event Date
29 January 2024
Filing date
08 March 2024
Lead Plaintiff Deadline
07 May 2024
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iRobot Corporation

iRobot Corporation designs, builds, and sells robots and home innovation products in the United States, Europe, the Middle East, Africa, Japan, and internationally. The company offers floor care pr...

    Ticker
    IRBT.US
    ISIN
    US4627261005
    CIK
    1159167
    Sector
    Consumer Cyclical
    Industry
    Furnishings, Fixtures & Appliances
    Country
    USA
    Address
    8 Crosby Drive, Bedford, MA, United States, 01730