Colin Angle, co-founder and CEO of iRobot, speaks at the Prime Air delivery drone unveiling event on Wednesday, June 5, 2019, in Las Vegas, Nevada, USA.
Joe Baglowitz | Bloomberg | Getty Images
Colin Angle, co-founder and former CEO iRoboton Monday called the company’s move to declare bankruptcy “deeply disappointing” and “nothing short of a tragedy for consumers.”
The robot vacuum cleaner pioneer announced Sunday that it has filed for bankruptcy protection after years of financial difficulties and will be taken private by financier and major supplier Shenzhen Picea Robotics Co., Ltd.
“Today’s outcome is extremely disappointing. And it was avoidable,” Angle told CNBC in a statement. “This is nothing short of a tragedy for consumers, the robotics industry, and America’s innovation economy.”
iRobot said in a court filing Sunday that it has assets and liabilities of between $100 million and $500 million. The company said it owes about $100 million to new owner Picea, more than $5.8 million to GXO Logistics, and about $3.4 million to U.S. Customs and Border Protection for unpaid duties and other debts.
iRobot stock plunged more than 72% on Monday.
Founded in 1990 by Angle and two other researchers at the Massachusetts Institute of Technology, iRobot began manufacturing military and defense technology for governments before launching its flagship product, the Roomba, in 2002 and establishing itself as an early leader in the vacuum cleaner market.
The company’s future remains uncertain after that. Amazon has abandoned its planned $1.7 billion acquisition of the company in January 2024, citing regulatory oversight from the European Union and the U.S. Federal Trade Commission. iRobot then announced it would lay off 31% of its staff and Angle would step down as CEO and chairman of the board.
Amazon CEO Andy Jassy called regulators’ efforts to block the deal a “sad story” and said it would have given iRobot a better competitive advantage against rivals.
Angle said Monday that acquiring Amazon is the “most viable path” for iRobot to compete globally. He added that iRobot’s bankruptcy should be a “warning” to competition watchdogs.
Helen Greiner, one of iRobot’s co-founders, said in a LinkedIn post on Monday that the company’s restructuring plan under Chinese ownership would not be good for “consumers, employees, shareholders, the state of Massachusetts, or the United States.”
The company faced increasing competition from cheaper, faster-growing rivals such as China-based Anker, Ecovacs and Roborock. Supply chain constraints in recent years have added to the strain on iRobot’s business, which has struggled to deal with shipping and inventory delays and reduced revenue.
The company’s financial outlook has deteriorated significantly since the deal with Amazon fell through, and in October iRobot said it would be forced to file for bankruptcy protection if it cannot secure additional capital or find a buyer.
iRobot CEO Gary Cohen said in a statement Monday that the restructuring plan will help secure the company’s “long-term future.” iRobot said it does not expect the bankruptcy proceedings to disrupt product functionality or customer support.
The company’s third-quarter sales were $145.8 million, down about 25% from $193.4 million in the same period last year, and iRobot has about $190 million in debt.
