VIZIO Holdings (VZIO): $10.99
Market Cap: $2.17 billion
A massive retailer attempts to buy a home electronics company and fails because regulators are concerned about data collected by the electronics company falling into the hands of the retailer. That was the story that played out with Amazon’s troubled acquisition of iRobot (IRBT) that lasted nearly 18 months before failing last month. It looks like Walmart did not pay much heed to the arc of that story before announcing the all cash acquisition of VIZIO Holding Corp. (VZIO) for $1.88 billion or $11.50 per share in cash last week.
Just like VIZIO, iRobot had razor thin net margins before the Amazon deal was announced and there were reports of Roomba vaccum cleaners not just collecting data but recording video of its customers. VIZIO was the subject of a Propublica story as far back as 2015 titled Own a Vizio Smart TV? It’s Watching you.
VIZIO paid a fine of $2.2 million to settle charges brought by the FTC and the New Jersey attorney general and also agreed to pay $17 million to settle a class action lawsuit. The lawsuit brought by Software Freedom Conservancy against VIZIO in 2021 related to the company’s use of open source software and unwillingness to release the source code used in its SmartCast operating system raises additional questions about the company’s practices.