iRobot, the US company behind the Roomba robot vacuum cleaner, has filed for Chapter 11 bankruptcy protection and agreed to be taken over by one of its Chinese suppliers.
The US-listed firm said it had reached a restructuring deal with Picea Robotics, a subsidiary of its main supplier, which will acquire the business. The bankruptcy filing was made in Delaware and is intended to allow iRobot to continue operating while strengthening its finances.
iRobot has struggled in recent years as profits declined following the pandemic, hit by supply chain disruptions and growing competition from cheaper rivals. Earlier this month, the company warned it could face bankruptcy. Chief executive Gary Cohen said the deal would combine iRobot’s design and research strengths with Picea’s manufacturing and technical expertise.
The takeover comes three years after Amazon abandoned plans to buy iRobot for $1.4bn following opposition from EU competition authorities. Although iRobot received $94m in compensation, much of it was used to cover fees and repay debt, some of which was later acquired by Picea’s Hong Kong subsidiary.
The acquisition may revive privacy concerns, as previous takeover talks raised fears about access to home-mapping data generated by Roomba devices. iRobot said the bankruptcy process would not disrupt its app, product support or supply chains.
Founded in 1990 by MIT roboticists, iRobot was valued at more than $3bn in 2021 but is now worth about $137m. The company reported a net loss of $145.5m last year, and its shares fell more than 13% following the announcement.
