iRobot is insolvent, Chinese supplier Picea takes over business
Vacuum cleaning robot manufacturer iRobot has filed for insolvency. It is to be saved by Chinese supplier Picea, which is taking over the company completely.
(Image: iRobot)
iRobot, the US manufacturer of Roomba vacuum cleaning robots, filed for insolvency on Sunday under Chapter 11 proceedings before a court in the US state of Delaware. iRobot announced this on Sunday. The company is to be taken over by its main Chinese supplier, Picea.
It had been apparent for some time that iRobot might file for insolvency. As early as March 2025, the company expressed concerns about its own continued existence. The manufacturer of Roomba vacuum cleaning robots had increasingly fallen into financial difficulties. Reasons include increasing Chinese competition from low-priced vacuum cleaning robots but also customs-related uncertainties.
In the District of Delaware, iRobot has now initiated voluntary Chapter 11 proceedings, a restructuring, and reorganization process under US insolvency law, which allows the company to restructure under court supervision to restore solvency.
100 percent takeover by Picea
Picea, iRobot's main contractual partner is to save the company. To this end, both companies have concluded a Restructuring Support Agreement (RSA), which stipulates that Picea will take over 100 percent of iRobot's capital shares. This will achieve debt relief, allowing iRobot to continue its entire business operations. This includes further product development and presence in global markets.
Customers of iRobot products therefore have no reason to worry, both companies promise. App functionality and customer support will continue seamlessly. Business relationships with global partner companies, such as suppliers, will also be maintained.
iRobot has filed motions with the court to maintain business operations. Employees are to be paid on time, and suppliers and creditors are to be paid in full.
The transaction to Picea still needs to be approved by the court. iRobot will then be wholly privately owned by Picea. The company's common stock will no longer be traded on the Nasdaq Stock Market LLC or any other national exchange, iRobot announced. iRobot hopes to achieve a more stable balance sheet as a result.
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However, the outlook for holders of the company's common stock is likely to be bleak. They will not receive any shares in the newly organized company. All issued and outstanding equity interests will likely be canceled, resulting in a total loss, provided the court approves the Chapter 11 proceedings.
(olb)
