Aug 5 (Reuters) – Amazon.com Inc (AMZN.O) will purchase the maker of robotic vacuum cleaner iRobot Corp (IRBT.O) in an all-cash deal for about $1.7 billion, within the newest push by the world’s largest on-line retailer to develop its cart of good dwelling gadgets.

Amazon can pay $61 per share, valuing the Roomba-maker at a premium of 22% from the inventory’s final closing value of $49.99.

Its shares rose about 19% in early buying and selling. At its peak through the pandemic lockdowns, iRobot traded at $197.four as hygiene-conscious shoppers invested in premium robotic vacuum cleaners.

Moreover sweeping up grime, Roomba vacuums that price as a lot as $1,000 gather spatial knowledge on households that would show useful to firms creating so-called good dwelling know-how.

However its fortunes took successful as shoppers began rethinking how they spend their cash amid rising inflation. Its second-quarter income fell 30% on weak demand from retailers in North America and Europe, Center East and Africa.

The deal comes at a time when analysts count on cash-rich know-how firms to get on an M&A spree to make the most of low valuations resulting from progress pressures. Amazon presently has money and cash-equivalents of greater than $37 billion.

“We’ve not heard a lot recently about Amazon’s good dwelling gadgets technique and this acquisition places it again on the agenda,” mentioned Atlantic Equities analyst James Cordwell.

Units make up for a fraction of the general gross sales of Amazon, which sells good thermostats, safety gadgets, wall mounted good show and had not too long ago launched a canine-like robotic known as Astro.

“It looks like (CEO) Andy Jassy goes to make use of M&A greater than Jeff Bezos and it makes extra sense to me now that Amazon is greater and has additional cash,” mentioned D.A. Davidson analyst Thomas Forte.

In case the deal is terminated, Amazon can be required to pay iRobot $94 million in termination price. On completion of the deal, Colin Angle will stay because the chief government of iRobot.

Reporting by Akash Sriram and Nivedita Balu in Bengaluru; Modifying by Arun Koyyur

Our Requirements: The Thomson Reuters Belief Ideas.