– Google enters an agreement to acquire wearable leader Fitbit for $2.1 billion in cash, approximately $7.35 per share.
– The acquisition of Fitbit shakes up the fitness and wearables market and gives Google a considerable market share against competitor Apple.
– Fitbit health and wellness data will not be used for Google ads and will give Fitbit users the choice to review, move, or delete their data.
Fitbit, Inc. today announced that it has entered into a definitive agreement to be acquired by Google LLC for $7.35 per share in cash, valuing the company at a fully diluted equity value of approximately $2.1 billion. The news confirms previous speculations of a pending acquisition that was reported earlier this week.
“Over the years, Google has made progress with partners in this space with Wear OS and Google Fit, but we see an opportunity to invest even more in Wear OS as well as introduce Made by Google wearable devices into the market. Fitbit has been a true pioneer in the industry and has created engaging products, experiences and a vibrant community of users. By working closely with Fitbit’s team of experts, and bringing together the best AI, software and hardware, we can help spur innovation in wearables and build products to benefit even more people around the world,” said Rick Osterloh, Senior Vice President, Devices & Services at Google in a blog post announcement.
Google Will Not Used Fitbit Health & Wellness Data for Google Ads
“Google aspires to create tools that help people enhance their knowledge, success, health, and happiness. This goal is closely aligned with Fitbit’s long-time focus on wellness and helping people live healthier, more active lives. But to get this right, privacy and security are paramount. When you use our products, you’re trusting Google with your information. We understand this is a big responsibility and we work hard to protect your information, put you in control and give you transparency about your data. Similar to our other products, with wearables, we will be transparent about the data we collect and why. We will never sell personal information to anyone. Fitbit health and wellness data will not be used for Google ads. And we will give Fitbit users the choice to review, move, or delete their data, added Osterloh.
Impact for Fitness and Wearables Market
The digital health and wellness market is crowded, with an estimated 14 million U.S. adults currently subscribed to a service and paying an average of $174 annually for different apps. Based on this data, there remains a void in the market for a single app that can provide quality health and fitness tools, personalized guidance and coaching all in one place. The acquisition of Fitbit shakes up the fitness and wearables market and gives Google considerable market share against competitor Apple.
“More than 12 years ago, we set an audacious company vision – to make everyone in the world healthier. Today, I’m incredibly proud of what we’ve achieved towards reaching that goal. We have built a trusted brand that supports more than 28 million active users around the globe who rely on our products to live a healthier, more active life,” said James Park, co-founder and CEO of Fitbit. “Google is an ideal partner to advance our mission. With Google’s resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster, and make health even more accessible to everyone. I could not be more excited for what lies ahead.”
The transaction is expected to close in 2020, subject to customary closing conditions, including approval by Fitbit’s stockholders and regulatory approvals. Qatalyst Partners LLP acted as financial advisor to Fitbit, and Fenwick & West LLP acted as legal advisor.