The sale of Nokia Digital Health to Withings co-founder Éric Carreel — who first sold the company to the Finnish tech giant two years ago — has been completed, Nokia said Thursday. The deal was announced in early May as part of Nokia's efforts to streamline its operations and cut costs in segments which aren't particularly profitable so as to be able to commit more resources to licensing, telecommunications, and business-to-business solutions, particularly those related to 5G. No financial terms of the transaction have been disclosed, though Mr. Carreel is understood to have paid significantly less than Nokia did when buying the unit in 2016, having committed the equivalent of $191 million to that endeavor.
The new owner will take over the firm's existing product portfolio and continue selling Nokia-branded offerings, but the Withings brand itself is also meant to relaunch by the end of the year. New digital health devices will be developed by the company as well, but it's presently unclear whether the Withings and Nokia brand are planned to co-exist on the market. Nokia's strategic shift that led to the sale of its wearable and smart scale unit started in 2017, with the firm increasing its focus on licensing while waiting for its 5G investments to start paying off. No significant returns may be generated prior to 2019, with Nokia as a whole now being on a decline, as revealed by its consolidated financial report for the first quarter of the year.
Nokia will still collect licensing fees for all health-focused gadgets sold under its brand going forward, much like it does in the mobile space where smartphones launching as part of its brand are technically designed and manufactured by Finnish HMD Global and its partners from China. Withings will continue operating out of its original headquarters on the southern outskirts of Paris and should share first details about its upcoming products no later than fall. The wearable segment as a whole is still on the rise, but mostly thanks to general-purpose smartwatches and fitness trackers, whereas more specialized devices remain a relatively niche category, according to most industry trackers.