By Foo Yun Chee
BRUSSELS (Reuters) – Amazon’s $1.4 billion acquisition of robot vacuum maker iRobot will be blocked by EU antitrust regulators, three people familiar with the matter said on Friday, as enforcers beef up scrutiny of Big Tech deals.
The U.S. online retail giant defied a European Commission’s warning that the deal could restrict competition in the market for robot vacuum cleaners by declining to offer remedies to address such concerns last week.
The Commission, which is scheduled to decide on the deal by Feb. 14, and Amazon declined to comment.
The regulator’s main concerns were that Amazon may thwart iRobot rivals on its online marketplace, especially in France, Germany, Italy, and Spain.
While these could be addressed by newly enforced EU tech rules known as the Digital Markets Act, the Commission feels that the lengthy enforcement process and the fact that the new legislation has not been challenged in court means that it is better to block the deal now, one of the people said.
A veto would raise the bar for future Amazon acquisitions for online rivals with EU antitrust enforcers who will likely demand major remedies in exchange for their green light.
iRobot shares were down 30% in late trade.
(Reporting by Foo Yun Chee, Editing by Louise Heavens)