The US company behind the Roomba robot vacuum has filed for Chapter 11 bankruptcy protection and agreed to be taken over by one of its Chinese suppliers.
iRobot, which pioneered consumer robot vacuums in the early 2000s, will be acquired by a subsidiary of Picea Robotics, its main manufacturing partner. The US-listed company said the bankruptcy filing in Delaware is part of a restructuring deal that will allow it to continue operating while stabilising its finances.
The company has struggled in recent years due to supply chain disruptions, rising competition from cheaper rivals and weakening post-pandemic demand. Earlier this month, iRobot warned it could face bankruptcy. Its chief executive, Gary Cohen, said the agreement with Picea would strengthen the company’s financial position and help it remain competitive in the smart home robotics market.
The takeover follows the collapse of Amazon’s proposed $1.4bn acquisition of iRobot, which was abandoned last year after regulatory opposition in the EU. Although iRobot received $94m in compensation, much of that money went toward fees and debt repayments.
The deal may revive concerns about data privacy, as past critics warned that ownership of iRobot could grant access to detailed home mapping data collected by its devices. iRobot said the bankruptcy process will not disrupt its products, app services or customer support.
Founded in 1990 by MIT roboticists, iRobot was valued at more than $3bn during the pandemic but is now worth about $137m after posting a $145.5m loss last year. Its shares fell more than 13% following the announcement.
