Fossil Group Acquires Wearable Technology Firm Misfit, Inc.
Fossil Group (UPIC: FOSS0001) has entered into an agreement to acquire Misfit, Inc., an innovator and manufacturer of wearable and connected devices. The Richardson, Texas-based supplier expects the acquisition to close before the end of fiscal 2015, subject to customary closing conditions and regulatory approval. The purchase price of $260 million, including transaction costs, will be funded through a combination of cash on hand and bank debt.
The acquisition enables the company to expand its addressable market, offering consumers both traditional timepieces and connected accessories. Misfit brings a scalable cloud and app platform, its software and hardware engineering team, a native wearable technology brand and a pipeline of innovative products. Sonny Vu, founder and chief executive officer of Misfit, will serve as president and chief technology officer of connected devices for Fossil Group, Inc., and will be a member of the company’s executive leadership team.
“We have a significant opportunity to add technology and connectivity across our platform of watches and accessories,” says Kosta Kartsotis, chief executive officer of Fossil Group. “With the acquisition of Misfit, Fossil Group will be uniquely positioned to lead the convergence of style and technology and to become the fashion gateway to the high-growth wearable technology and connected device markets.”
Fossil says that the acquisition will allow the supplier to own an established technology platform; scale Misfit’s technology across Fossil, Skagen and a portion of its portfolio of 16 platforms; expand its addressable market with new distribution channels, new products, new brands and new enterprise partnerships, including music, fitness, healthcare and digital entities; and lead in the connected devices space by harnessing the power of Misfit’s software and hardware engineering team.
“We fundamentally believe consumers care about both technical functionality and fashionable design. In fact, one without the other is simply not enough. With the acquisition of Misfit, Fossil Group will be positioned to win with the connected consumer,” says Greg McKelvey, chief strategy and digital officer of Fossil Group. “Our world-class design and global distribution, combined with Misfit’s technology platform, creates a significantly advantaged, multi‐brand and global wearable technology business poised to drive the convergence of fashion and technology.”
Vu adds, “We are thrilled to join forces with Fossil Group to usher in the next era of wearables where elegance, beauty and long-lasting wearability are paramount. Together, we will introduce products that blend Misfit’s seamless, intuitive technology and user experience with the design, style and branding that is the hallmark of Fossil Group.”