iRobot stock drops 30% as Roomba maker warns of stalled search for buyer

shares of iRobot Shares plunged more than 30% on Monday after the company warned that its search for a buyer had hit major hurdles and its financial situation remained dire.

The Roomba maker has been racing to sell itself since March, but last week the only remaining potential buyer withdrew from the process after “extended exclusive negotiations,” iRobot said in a regulatory filing.

iRobot’s future remains uncertain Amazon has abandoned its planned $1.7 billion acquisition of the company in January 2024, citing regulatory oversight.

Since then, iRobot has struggled to generate cash and pay off debt, warning in March that there were “significant doubts” about its ability to continue operating.

Amazon CEO Andy Jassy called regulators’ efforts to block the deal a “sad story” and argued it would have allowed iRobot to scale up and compete with fast-growing rivals such as China-based Anchor, Ecovacs and Roborock.

iRobot announced Monday that the price per share offered by the last remaining bidder was “significantly lower” than the company’s stock price in recent months. iRobot stock has fallen more than 50% this year.

“We are not currently in advanced negotiations with alternative counterparties regarding a potential sale or strategic transaction,” iRobot said in its filing. “As such, there remains no assurance that consideration of strategic alternatives will result in any transaction or result.”

In July 2023, iRobot received a $200 million loan from The Carlyle Group as a stopgap measure until the deal with Amazon was completed. iRobot said in its filing that it has extended the exemption period for certain financial obligations until Dec. 1, the sixth amendment to the credit agreement.

The filing warns that if the lenders fail to provide additional funding or fail to secure other sources of financing in the short term, “we may be forced to significantly reduce or cease operations and are likely to be subject to bankruptcy protection.”