Fitbit Set to Acquire Smartwatch Maker Pebble
December 01 2016 - 3:14PM
Dow Jones News
By Georgia Wells
Fitbit Inc. is close to acquiring smartwatch maker Pebble,
according to a person familiar with the matter, the latest sign of
consolidation in the weakening wearables market.
The two sides are in advanced negotiations, the person said. If
the deal goes through, Fitbit will likely shut down Pebble's brand,
according to the person. Fitbit's interest is in Pebble's
intellectual property, including its operating system, as well as
its employees, the person added. Pebble is running out of money,
according to this person.
For Fitbit, whose sales growth has slowed dramatically this
year, the acquisition "signals greater ambitions in smartwatches,
despite proving to be a nascent market," Citi Research analyst
Stanley Kovler said.
Pebble is a small player in smartwatches. It controls 3.2% of
the smartwatch market, according to research firm IDC, and ranks
fifth in sales behind Apple Inc., Garmin Ltd., Samsung Electronics
Co. and Lenovo Group Ltd. Fitbit, which is better known for its
simpler fitness trackers, didn't rank among the top smartwatch
vendors.
But Silicon Valley-based Pebble was one of the original pioneers
of the smartwatch and is known for its dedicated fans. At a time
when Apple and other smartwatch makers added lots of features to
their designs, Pebble created lighter watches with a backlit
display that allowed for longer battery life.
It raised more than $30 million from three Kickstarter campaigns
before launching its products. Pebble has also raised more than $25
million from venture investors. However over the past year, Pebble
has struggled financially and laid off workers, according to a
person familiar the deal talks.
News of the deal was first reported by The Information on
Wednesday.
Write to Georgia Wells at Georgia.Wells@wsj.com
(END) Dow Jones Newswires
December 01, 2016 14:59 ET (19:59 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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