Amazon Buying Roomba Maker iRobot In $1.7 Billion Deal To Grow Its Arsenal Of Connected Devices

Amazon is buying iRobot in a $1.7 billion all-cash deal, marking a major addition to its growing list of smart home technology products.

The agreement values iRobot shares at a 22% increase over Thursday's closing price.

iRobot's stock price surged more than 19% to $59.50 after the market opened Friday morning, though Amazon's stock price dropped 1.3% to $140.67 Friday morning as part of a broad market downturn in response to a stronger-than- expected July jobs report.

Colin Angle will remain iRobot's CEO after the deal is completed.

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iRobot's shareholders must approve the deal before it goes through.

Key Background

The Ring video doorbell is one of the best-selling smart home technology products of all time. According to the Wall Street Journal, the $1.7 billion deal is Amazon's fourth biggest acquisition, behind its $13.7 billion purchase of Whole Foods in 2017, $8.5 billion purchase of MGM in March and a $3.9 billion agreement in July to buy 1Life healthcare.

The change in Whole Foods was caused by Amazon.