Rumor: Fitbit, a manufacturer of smart watches and bracelets, plans to buy its competitor Pebble for $ 40 million

With high probability, the independent manufacturer of smart watches Pebble will soon become history. According to rumors that are confirmed by major English-language publications , Fitbit plans to buy Pebble for an amount from $ 34 to $ 40 million.

The amount of the transaction, and without that scanty, becomes even smaller after reviewing the company's debts: Pebble owes suppliers and creditors at least $ 28 million, that is, most of the amount from the sale of a business will go to pay off debts.

Indie manufacturer Pebble is not able to withstand competition with larger market players. As one of the founders of the smart watch industry, a startup that has grown into a manufacturer has failed to cope with many difficulties. One of the main problems is not so much the demand for smart watches , as the evangelicals of devices predicted. Not only Pebble has encountered this, but also such manufacturers as, for example, Apple, Samsung. The other is ineffective management and persistent funding problems.
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Back in 2015, the manufacturer of classic watches Citizen planned to buy Pebble for $ 740 million - an amount almost 20 times greater than the amount of the current deal with Fitbit, but Pebble refused. After the failure of Pebble Time Round watches on sale, the company decided to buy Intel for much less $ 70 million. The main condition was not to go to Kickstarter with the new Pebble 2 and Pebble Time 2 (the campaign eventually collected $ 12 million). But Pebble again refused the offer, and the discussion within the organization led to the departure of two senior managers. The irony is that they are now working at Intel.

In March of this year, the company tried to level out its position by reducing staff. Then about 25% of the company's employees were fired (40 people altogether). But all attempts to keep Pebble afloat did not give the desired result. Seven months after the company's shares were placed on the stock exchange at a price of $ 20 (with a subsequent increase of 65%), today they are trading at around $ 8.5 per share.

In fact, the sale of the Pebble Fitbit, which feels much better and more confident, can be called the liquidation of the business. The further fate of the brand is a big question. Fitbit is interested, first of all, in the development of Pebble software, as well as other intellectual property of the company.