The deal is expected to be finalized in 2020.
According to the release, the deal will see Fitbit at a valuation of US$2.1 billion, with shares sitting at a value of US$7.35 each.
After rumours swirled on Monday of an impending deal, Fitbit’s stock surged 30 per cent and the stocks have risen once again after the deal was confirmed, this time rising 17 per cent.
“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, the co-founder and chief executive officer of Fitbit, in the press release. “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.”
Google’s hardware chief, Rick Osterloh, wrote in a blog post that this deal will help Google advance its progress for Wear OS, its operating software for smartwatches.
“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,” Osterloh wrote in his blog. “Google also remains committed to Wear OS and our ecosystem partners, and we plan to work closely with Fitbit to combine the best of our respective smartwatch and fitness tracker platforms.”
This move follows Google’s January purchase of US$40 billion of smartwatch technology from Fossil.