Mergers and acquisitions are common business occurrences involving the consolidation of companies or assets through various types of financial transactions. Mergers, acquisitions, consolidations, tender offers, and more can all dramatically change the face of a well-known business. In fact, Google recently acquired Fitbit in its largest acquisition to date for about $2.1 billion. This comes as the search engine giant aims to grow its presence in the smartwatch and fitness technology industries.
Fitbit is the world’s leading maker of wearable fitness activity trackers, a market that has grown fairly quickly since the launch of the product in 2015. Fitbit co-founder and CEO James Park stated that, “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.”
This won’t be Google’s first foray into hardware, however, as the company previously released its Pixel phone and Nest devices. Making this acquisition is its first dive into smartwatches and other wearable devices.
Analysts weren’t surprised by Google’s move, as rumors previously circulated indicating the company would move in the direction of smartwatch technology. But, the Apple Watch has failed to match the high adoption bar set by its predecessors; and, many experts wonder how many consumers are willing to pay a premium price for a wearable, data-collecting device.
Understanding Mergers and Acquisitions
As mentioned above, mergers and acquisitions involve the outside purchase of businesses assets through various types of financial transactions. The principal parties involved in a transaction may also include individuals, but rarely do. It is more common for a corporation, limited liability company, partnership, or other entity to engage in these transactions with other business entities rather than people.
While a merger or acquisition can be the right move to grow your company, they come with their own risks due to tax, compliance, and other various legal aspects involved.
Houston Commercial Litigation Attorneys
Entering into a new business venture can be incredibly complex. For the legal team at Feldman & Feldman, every case is unique and there is no one-size-fits-all solution. We work closely with our clients to offer the best results. If you are facing any type of business dispute or commercial litigation, contact the experienced attorneys at Feldman & Feldman today to schedule a consultation to discuss your case.