14 DAY TRIAL // The FTC gave Google the green light to purchase Nest on February 4, 2014 and, according to a regulatory filing with the US Security and Exchange Commission, it only took Google three days to complete the purchase.
Google’s $3.2 billion deal with Nest has been quite unexpected and the huge price tag makes it memorable.
“In January 2014, we entered into an agreement to acquire 100% of Nest Labs, Inc. (Nest), a company whose mission is to reinvent devices in the home such as thermostats and smoke alarms, for a total purchase price of $3.2 billion in cash, subject to adjustments. Prior to this transaction, we had an approximately 12% ownership interest in Nest, which was net against the total consideration,” reads the SEC filing.
“We expect that the acquisition will enhance Google's suite of products and services and allow Nest to continue to innovate upon devices in the home, making them more useful, intuitive, and thoughtful, and to reach more users in more countries. The transaction closed on February 7, 2014,” it continues.
The transaction is considered to be a “step acquisition” under GAAP. This means that Google’s ownership interest in Nest held before the acquisition needs to be remeasured to fair value at the date of the acquisition.
The exact numbers will be revealed when the analysis is completed in the first quarter of 2014.
Nest has built a couple of devices. The smart thermostat enables users to control the temperatures within the home from a distance. It can also learn a user’s habit so it knows which rooms to heat and where to lower the temperature according to the space where they spend more time.
Nest also has a smart smoke and carbon monoxide alarm, which gives users a heads up before ringing the alarm and which they can silence with a hand wave.