It has been well over a year since Amazon (NASDAQ: AMZN) announced it would acquire iRobot (NASDAQ: IRBT), the consumer robot company best known for its Roomba line of robot vacuum cleaners. The acquisition has stalled over regulatory concerns, and its initial terms have been amended. Nonetheless, iRobot shares are currently trading 43% below the updated acquisition price, creating a significant merger arbitrage opportunity.

Let's explore what happened since the acquisition bid was announced and how investors could capitalize on this situation.

In Aug. 2022, Amazon announced its intention to acquire iRobot in an all-cash deal for $1.7 billion at a buyout price of $61 per share. Almost a year later, in July 2023, that deal was amended to a buyout price of $1.4 billion, or $51.75 per share, after iRobot took on $200 million in new debt to fund its ongoing operations.

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Source Fool.com