Nokia said Tuesday it plans to pay 170 million Euros ($191 million) in cash to acquire French fitness gadget maker Withings in a bid to kickstart its re-entry into the consumer market and a move into digital health.
“We have said consistently that digital health was an area of strategic interest to Nokia, and we are now taking concrete action to tap the opportunity in this large and important market,” Nokia CEO Rajeev Suri said in a statement. “With this acquisition, Nokia is strengthening its position in the Internet of Things in a way that leverages the power of our trusted brand, fits with our company purpose of expanding the human possibilities of the connected world, and puts us at the heart of a very large addressable market where we can make a meaningful difference in peoples’ lives.”
The deal comes almost two years to the day from when Nokia sold its mobile phone business to Microsoft. While most of what remains of the Finnish tech company sells network equipment, a smaller Nokia Technologies unit aims to help fuel the company fulfill its longer-term goal of restoring itself as a leader in consumer electronics.
Withings makes, among other things, a Wi-fi connected scale and fitness-tracking wearables. The deal is expected to close in the third quarter, after which Withings’ 200 employees will join Nokia Technologies, with Withings CEO Cedric Hutchings reporting to Nokia Technologies head Ramzi Haidamus.
Nokia Technologies also makes the Ozo, a $60,000 virtual reality capture camera, and is responsible for licensing the Nokia brand name for use in phones and other consumer products.
The company has also said it will look to license its brand for use in the mobile phone market once it can find an ideal partner, an effort that it had hoped to wrap up by the end of last year.
“We almost owe it to ourselves to go experiment in the consumer area,” Suri told Tecscoop in February.
The broader Finnish company is looking to cut thousands of jobs in the wake of its Alcatel-Lucent purchase, but Nokia Technologies is expected to be largely spared from the cost-cutting effort.