iRobot mentioned it should proceed help by way of chapter proceedings. Credit score: Adobe Inventory
As anticipated, iRobot Corp. yesterday introduced that it has entered right into a restructuring help settlement with its creditor Santrum Hong Kong Co. and first contract producer Shenzhen Picea Robotics Co. The Chinese language firms plan to accumulate the robotic vacuum cleaner maker by way of a court-supervised Chapter 11 chapter course of.
“At this time’s announcement marks a pivotal milestone in securing iRobot’s long-term future,” acknowledged Gary Cohen, CEO of iRobot. “The transaction will strengthen our monetary place and can assist ship continuity for our shoppers, clients, and companions.”
“Collectively, we are going to work to proceed advancing the industry-leading Roomba robots and sensible house applied sciences which have outlined the iRobot model for greater than three many years,” he added. “By combining iRobot’s innovation, consumer-driven design, and R&D with Picea’s historical past of innovation, manufacturing, and technical experience, we imagine iRobot can be properly geared up to form the subsequent period of sensible house robotics.”
Picea develops and producers equipment motors, sensors, and robotic vacuum cleaners in China and Vietnam. The firm mentioned it has greater than 7,000 staff, has made and bought greater than 20 million robots, and holds over 1,300 mental property rights worldwide.
Picea manufactures its personal robotic vacuum cleaners and mops. Supply: Picea Robotics
Snags piled up for Roomba maker
Based in 1990 by MIT researchers Rodney Brooks, Colin Angle, and Helen Greiner, iRobot pivoted from protection functions with the discharge of the Roomba robotic vacuum in 2002. It was arguably the primary family title in client robotics, promoting an estimated complete of greater than 50 million units.
After falling income as a result of struggles with diversifying its product line, growing world competitors, and U.S. and EU antitrust issues scuttling a proposed Amazon acquisition, iRobot’s chapter appeared inevitable. The Bedford, Mass.-based firm‘s income continued to drop, and it had already carried out a number of rounds of layoffs.
Final month, iRobot reported to the U.S. Securities and Change Fee that it had failed to seek out one other purchaser and had “no sources upon which it may draw for extra capital.” At the moment, Santrum, a subsidiary of Picea Robotics, took on the corporate’s debt, which mixed with its excellent payments to the contract producer, totaled greater than $350 million.
iRobot model plans to proceed help
iRobot mentioned it and a few of its associates plan to start a pre-packaged Chapter 11 course of within the District of Delaware Courtroom by February 2026. Below the phrases of the restructuring settlement, Picea will acquire 100% of the corporate’s fairness, which it mentioned will “de-lever the corporate’s stability sheet and allow iRobot to proceed working.”
iRobot mentioned the proceedings will allow it to proceed app performance, buyer applications, world companions, provide chain relationships, and product help. It claimed that it’s going to proceed “to fulfill its commitments to staff and make well timed funds to distributors and different collectors in full for quantities owed earlier than, throughout, and after the court-supervised course of.”
As soon as the courtroom approves the transaction, iRobot can be a non-public firm wholly owned by Picea, and its shares of widespread inventory will not be listed on The Nasdaq Inventory Market LLC or some other nationwide inventory trade. As well as, holders of present iRobot inventory wouldn’t obtain any fairness, and shareholders of widespread inventory “will expertise a complete loss,” mentioned the corporate.
“The transaction is designed to ship a extra secure stability sheet and renewed capacity to put money into its subsequent technology of robotics, sensible house improvements, and buyer expertise enhancements,” mentioned Picea.
Publicly filed paperwork associated to the chapter can be accessible without cost on the web site of Stretto Inc., iRobot’s claims agent.
