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Google buys Nest Labs for $3.2 billion

Image courtesy of Nest Lab

TORONTO – Google has bought Nest Labs for US$3.2 billion.

Google announced the move to acquire the smart home device maker later  Monday.

“We’re thrilled to join Google. With their support, Nest will be even better placed to build simple, thoughtful devices that make life easier at home, and that have a positive impact on the world,” said CEO of Nest Labs Tony Fadell in a press release.

Fadell  launched Nest Labs in 2010. He previously worked at Apple, where he helped design the iPod and original iPhone.

The company specializes in home tech devices such as thermostats and smoke alarms. The company’s Nest Learning Thermostat is designed to learn how inhabitants like their homes to be heated and cooled so it can automatically adjust the temperature on its own.

The Nest Thermostat is offered for sale on Apple’s Canadian online store. Apple.ca/Screenshot

Analyst Shyam Patil of Wedbush Securities said Google is positioning itself to offer products that work on the “Internet of Things” – specifically a “connected home” full of intelligent wireless devices that collect data and could be controlled with a smartphone. The “Internet of Things” is a global network that not only links computers, tablets and phones but connects everything from bikes to washing machines to thermostats. Last year Google introduced Chromecast, a device that lets users connect their TVs and mobile devices.

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“It’s a big market opportunity and it provides Google with good technology to attack it over time,” Patil said in a telephone interview. He has a “Neutral” rating on Google shares.

The deal is Google’s biggest since it closed on the $12.5 billion purchase of Motorola in May 2012.

READ MORE: Nest Labs tries to smarten up smoke detectors

Google was an early investor in Nest Labs.

– With files from The Associated Press

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