GOOGL Alphabet Inc

By Dave Sebastian 

Google said it has completed its $2.1 billion acquisition of Fitbit Inc., a deal that would let the search giant push more deeply into the wearable-device and health-data businesses, as it continues to face antitrust scrutiny.

The announcement on the deal closing came after European Union antitrust officials last month approved the acquisition with conditions aimed at protecting users' health data and preserving competition in the wearable-tech sector, clearing one of the deal's hurdles. But other antitrust agencies are continuing to scrutinize the transaction, including in the U.S., meaning Google's decision to move forward isn't without regulatory risk.

"This deal has always been about devices, not data, and we've been clear since the beginning that we will protect Fitbit users' privacy," Rick Osterloh, Google's senior vice president for devices and services, said Thursday.

To appease EU regulators, Google pledged not to use Fitbit data for advertising purposes in Europe and to store such data separate from any other Google data used in ads.

It also told regulators it would allow users to link their Fitbit data to competing apps and committed to allowing wearable-device makers open access to functions of Google's Android operating system.

Google, an Alphabet Inc. company, had offered concessions as part of the EU's investigation into the deal, which the bloc opened in August after rejecting Google's initial commitments as inadequate.

Fitbit, founded in 2007, makes so-called wearables, or watches and bracelets that primarily track health information like heart rate. The Fitbit deal, first agreed to in November 2019, remains under review by the U.S. Justice Department and Australia's competition authority. The move intensifies the battle among technology giants in enticing consumers through devices other than smartphones.

In response to Google's announcement, the U.S. Justice Department issued a statement emphasizing that its work on the transaction isn't done.

"The Antitrust Division's investigation of Google's acquisition of Fitbit remains ongoing," department lawyer Alex Okuliar said. "Although the Division has not reached a final decision about whether to pursue an enforcement action, the Division continues to investigate whether Google's acquisition of Fitbit may harm competition and consumers in the United States."

In Australia, where the competition authority has rejected Google's proposed moves to address competition concerns, the company is awaiting a decision on March 25.

The Australian Competition and Consumer Commission "continues to have concerns that Google's acquisition of Fitbit may result in Fitbit's rivals, other than Apple, being squeezed out of the wearables market, as they are reliant on Google's Android system and other Google services to make their devices work effectively," Rod Sims, who chairs the commission, said in December.

A Google spokeswoman said the DOJ allowed the deal to close, and that the company will continue to engage with Australian authorities.

Write to Dave Sebastian at dave.sebastian@wsj.com

(END) Dow Jones Newswires

January 14, 2021 12:18 ET (17:18 GMT)

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