According to the New York Times, Google said on Nov. 1 that it is acquiring Fitbit, the maker of fitness-tracking devices, for $2.1 billion to close the gap with Apple in the growing market for wearable electronics and to add muscle to its expanding hardware business.
- Why is the deal is likely to face regulatory scrutiny? On what basis?
- How old is the Fitbit company?
- What product is a direct competitor to FitBit?
- What is the market share of FitBit versus its direct competitor identified in question 3?
- If Google fails to secure permission from the SEC to buy FitBit, how much will it have to pay FitBit?
- If you were Google’s CFO, how would you account for the amount of money pledged in Question No. 5 above?
Wakabayashi, D. and Adam Satariano. (2019). Google to Buy Fitbit for $2.1 Billion. The New York Times, Nov. 1 (Retrievable online at https://www.nytimes.com/2019/11/01/technology/google-fitbit.html)