Why Roomba Maker IRobot Stock is Trading Lower Tuesday?

IRobot Corp IRBT stock is trading lower Tuesday after Amazon.Com Inc AMZN reduced the purchase consideration for the Roomba maker's takeover by 15%.

Under the amended terms, Amazon will pay $51.75 per share, revised from $61.00 per share.

Also Read: Following Roomba Acquisition, Amazon Eyes London's Ocado for Next Major Tech Investment

Also, iRobot has entered into a $200 million financing facility to fund its ongoing operations. For Amazon, the change in price per share is likely to be largely offset by the planned increase in iRobot's net debt under the new financing facility.

"We've reached an amended agreement with Amazon that reflects the incurrence of iRobot's new debt," said Colin Angle, chairman and CEO of iRobot. "iRobot is taking on new financing that we believe is sufficient to support our operations in a hyper competitive environment and meet our liquidity needs as well as pay off iRobot's existing debt. "

In June, the Competition and Markets Authority (CMA) cleared the $1.7 billion takeover.

iRobot designs and builds consumer robots, including robot vacuum cleaners sold under the 'Roomba' brand. The CMA has concluded that the deal would not hamper competition in the U.K.

Price Action: IRBT shares traded lower by 8.38% at $42.97 on the last check Tuesday. AMZN shares traded higher by 0.3% at $129.30.

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