Back in 2016, Nokia announced it was acquiring French digital health and wearables company Withings for €170 million ($192 million) in cash. Now, just two years later, the firm has confirmed it is selling the business back to Withings co-founder Éric Carreel.
Terms of the proposed deal, which is expected to close in Q2 2018 providing it passes the usual terms and conditions, have not been revealed, but it's thought to be substantially less than what Nokia paid a couple of years ago.
Nokia killed off the Withings name in 2017, rebranding the products, which include smart scales, digital health devices, and fitness tracker watches, as part of its Digital Health business.
But the rebranded Withings products weren't a huge success. Nokia announced a write-down of €141 million ($164 million) on the assets last October, and in the first quarter of this year, the Digital Health segment made just $20 million in revenue---a tiny amount next to the $5.9 billion in net sales brought in by Nokia's entire business.
Back in February, the company said it was conducting a strategic review of its Digital Health unit. A week later, a leaked memo seen by The Verge revealed that Nokia's chief strategy officer, Kathrin Buvac, had told employees that "our digital health business has struggled to scale and meet its growth expectations."
"Currently, we don't see a path for it to become a meaningful part of a company as large as Nokia."
In a press release, Nokia said its decision to sell the Digital Health business to Carreel is part of its shift to become a business-to-business licensing company. It famously licenses the Nokia name to HMD global, producer of the current crop of Nokia-branded handsets.
According to TechCrunch, both Nest and Samsung were eyeing the business before the deal was announced.