America based activity-tracker devices company Fitbit is offering deal to buy troubled smartwatch maker Pebble. If anonymous sources are to be believed then Pebble is to be sold to Fitbit for an undisclosed final amount which is quite below the value, seeing the kind of offers that the company received before.
Citizen and Intel were interested to buy Pebble and offered $740 million and $70 million, respectively almost a year back. Intel offered to buy the company demanding that the launch of Pebble 2 and Pebble Time 2 shall be delayed but Pebble refused the offer.
Experts are saying that the price value at which the company can be sold at this moment is believed to be between $34 million-$40 million which gives a clear picture about the sales chart of their latest products. Pebble owes $25 million to Silicon Valley Bank. 25% of workforce at Pebble has been laid off in March this year because of the financial crisis.
After acquiring the company, Fitbit won’t be selling their products but only make use of its technology and intellectual properties including their operating system which will eventually put an end to Pebble as a brand name in the market.
In June 2015 Fitbit had announced 62.5% increase from its opening price on its first day of trading, closing at $32.50. While the impact of the deal is still questionable to the experts because as for Fitbit, it has been still going strong with its active customers community but Pebble had to face a tough clash from the giants Samsung and Apple.
Pebble has been a top notch in the smartwatch market but the launch of Apple Watch had hit the Pebble sales very hard. Many key executives had left the company during the financial crisis including Head of Product Ital Vonshak and Vice President of software engineering Kean Wong. Interestingly, both Vonshak and Wong are now employed at Intel.
Fitbit is looking forward to design an ecosystem of devices by acquiring Pebble’s Operating System. Fitbit is known for developing wireless-enables wearable technology devices that can be used to measure number of steps walked, heart rate, quality of sleep, steps climbed, etc. In 2016 there was a 50% decrease in Fitbit stocks at NYSE, to which CEO James Park clarified that the company was undergoing a transformation to a ‘digital healthcare company’. Pebble customers seemed unhappy with the deal, saying that there was a time when Pebble was a trending gadget and everyone wanted to own one, it was the only option to work in perfect sync with iPhone. Public-benefit Corporation Kickstarter started a campaign for the development of smartwatch, which garnered huge success and collected $10 million for the development.