The Massachusetts-based company filed for Chapter 11 bankruptcy in the District of Delaware on Dec 14, according to a news release.

Under the restructuring, vacuum cleaner maker Shenzhen PICEA will receive the entire equity stake in the reorganised company. The company’s common stock will be wiped out under the proposed Chapter 11 plan.

The plan will allow the debtor to remain as a going concern and continue to meets its commitments to employees and make timely payments in full to vendors and other creditors for amounts owed throughout the court-supervised process, according to an iRobot statement.

“Today’s announcement marks a pivotal milestone in securing iRobot’s long-term future,” iRobot CEO Gary Cohen said in a statement.

The company warned of potential bankruptcy in December after years of declining earnings. At the time, Shenzhen PICEA acquired a major portion of its debt from US investor Carlyle Group Inc, and iRobot said it was in talks to secure new capital and address the outstanding debt.

Founded in 1990 by three MIT engineers, iRobot has evolved over more than three decades. It enjoyed significant early success, selling over 50 million robots, according to its website. Earnings began to decline since 2021 due to supply chain headwinds and increased competition.

A hoped-for by acquisition by Amazon.com in 2023 collapsed over regulatory concerns.