US Tech Giants Have Scuttled Over $70B In M&A Deals Following EU, UK Pushback

Lately, it seems like a lot of large technology acquisitions have fallen apart following pushback from European and U.K. antitrust regulators. In tandem, the value of these deals that didn’t get done continues to mount.

The latest scuttled transaction, Amazon’s planned purchase of robot vacuum maker iRobot for around $1.35 billion, would have been one of the largest in the consumer electronics space. On Monday, however, the retail giant announced it has terminated the acquisition, citing “undue and disproportionate regulatory hurdles.”

The deal faced scrutiny from both U.S. and EU antitrust regulators. However, it was the latter that objected most forcefully and publicly, with the European Commission warning in November that the proposed tie-up could hamper rival robot vacuum brands’ ability to compete.

The Amazon deal was the latest merger involving American technology companies to come apart in the wake of objections from EU and U.K. regulators. But it was by no means the largest. Others include:

• Adobe called off its planned $20 billion purchase of design software provider Figma in December, stating that it saw “no clear path to receive necessary regulatory approvals from the European Commission and the UK Competition and Markets Authority” to complete the deal.
• In October, the European Commission ordered genomics company Illumina to unwind its already completed acquisition of Grail, a cancer test provider it purchased for $8 billion in 2021. It was reportedly the first time the EC ordered a reversal of an acquisition.
• Meta paid $400 million in 2020 to acquire Giphy, a New York startup known for its searchable library of animated GIFs. Several months later, Meta decided to sell Giphy, facing backlash from British regulators concerned the deal would lessen competition in social media and the display advertising market. Giphy sold to Shutterstock in May 2023 for $53 million.
• Nvidia’s plan to acquire a rival chipmaker, U.K.-based Arm Holdings, for $40 billion fell apart two years ago following objections from regulators on both sides of the Atlantic. Arm went public on its own a few quarters later and was recently valued around $73 billion.

By this sampling alone, more than $70 billion worth of planned acquisitions by American technology companies have not come to fruition following scrutiny and objections from EU and U.K. antitrust authorities. That said, it’s pretty common for scuttled deals to have faced regulatory pushback from both sides of the Atlantic.

For instance, the largest withdrawn merger —  the Nvidia-Arm tie-up — faced considerable scrutiny from U.S. authorities. In the end, the U.S. Federal Trade Commission concluded that the deal would likely harm competition in the semiconductor industry.

Several media outlets also reported that the FTC planned to reject Amazon’s deal with iRobot, although the agency didn’t disclose this publicly prior to Monday’s termination announcement. In recent years, the agency, under Chair Lina Khan, has been more aggressive in reining in or rejecting acquisitions by large technology companies.

Meanwhile, several Big Tech acquisitions announced in the past few quarters have yet to close, and could likely face regulatory objections. This includes Qualcomm’s planned purchase of Israeli semiconductor company Autotalks. Big Tech investments in generative AI, including Microsoft’s funding of OpenAI, have also attracted the attention of U.S. and European regulators.

Others have gotten done, such as Broadcom’s purchase of VMware, which closed in November.

Expectations of stepped-up antitrust enforcement is likely a contributing factor to a slowdown in technology M&A activity in recent quarters. Per Crunchbase data, acquisitions of venture-backed startups hit an eight-year low last year.

Of course, there are other factors to point to besides regulatory pushback. Cash has become more expensive, while many startups have seen their valuations plummet from the highs of 2021.

Related reading:

• Figma’s Venture Backers Win Big With Adobe’s $20B M&A Deal
• Microsoft Agrees To Multibillion-Dollar Deal With OpenAI
• Arm Shares Jump 25% In Nasdaq Debut, Boosting IPO Market Enthusiasm
• Rough Ride: M&A Dropped 31% For VC-Backed Startups In 2023

Related Crunchbase Pro list:

• M&A Involving VC-Backed Startups In 2023

Illustration: Dom Guzman