Roomba Maker iRobot Files Chapter 11, Picea to Take Company Private

iRobot Corp., the Bedford, Massachusetts maker of Roomba robotic vacuums, filed a pre packaged Chapter 11 restructuring in the U.S. District Court for the District of Delaware and will be sold to Shenzhen Picea Robotics Co. Ltd. under a Restructuring Support Agreement. The filing, announced on December 14 and lodged in court on December 15, begins a court supervised process that would take the company private and cancel existing public equity.

Under the terms of the restructuring, Picea, described by iRobot as its primary contract manufacturer and secured lender, will receive 100 percent of the equity in the reorganized company. Reporting from iRobot makes clear that public stockholders will be left with no recovery. iRobot states stockholders "will experience a total loss and not receive recovery on their investment." Picea has manufacturing facilities in China and Vietnam and has built and sold more than 20 million robotic vacuums, a scale that underpinned its role as both supplier and creditor.

The RSA also involves Santrum Hong Kong Co. as a consenting lender. As part of the transaction Picea will cancel approximately $190 million remaining on a 2023 loan, a step intended to resolve secured lender claims and simplify the balance sheet going into a private ownership structure. iRobot and Picea characterized the deal as enabling iRobot to continue as a going concern through the restructuring and sale process.

Company officials have told customers and partners they expect ordinary course operations to continue through the court supervised process. iRobot said it anticipates no disruption to app functionality, customer programs, global partners, supply chain relationships, product support or customer service, and that product development and a global presence will continue under Picea ownership.

The filing follows a period of strategic shifts for iRobot, including a previously disclosed $94 million termination fee paid by Amazon under an earlier agreement. The move to a pre packaged Chapter 11 is intended to be expedited, allowing the company and its secured creditors to implement a sale and restructuring without a prolonged bankruptcy process.

For shareholders the outcome is stark. Under Chapter 11 restructurings that prioritize secured creditors, unsecured claimants and equity holders frequently receive little or no recovery. The planned transfer of all equity to a secured creditor and manufacturer illustrates a broader dynamic in consumer electronics, where thin margins, heavy capital intensity and tight supply chains can leave public equity vulnerable when strategic partners also hold lending exposure.

The deal also highlights longer term industrial trends. Reliance on contract manufacturers with global footprints has helped consumer robotics scale rapidly, but it has also concentrated operational control outside the United States. That concentration may fuel renewed policy debate about supply chain resilience and the strategic importance of domestic manufacturing capacity for emerging technologies.

Next steps require court approval of the RSA and confirmation of the Chapter 11 plan. If the court confirms the pre packaged plan, iRobot will be removed from public markets and become a privately held company under Picea and the consenting lenders, while continuing to market Roomba products under the new ownership.