Blackwells Capital sees Berkshire Hathaway and Adidas among potential buyers of Peloton. In a 65-page presentation, Blackwells named 19 potential acquirers for the fitness company. Blackwells, which has a 5% stake in Peloton, published the presentation on February 7. Sign up here for our daily newsletter, 10 Things Before the Opening Bell. The activist investment firm that had been calling for Peloton CEO John Foley’s exit has compiled a list of what it thinks could be the most natural buyers of the beleaguered fitness firm, with Berkshire Hathaway a standout at the top of the ranking.
In a 65-page presentation to the Peloton Board, Blackwells Capital named 19 potential strategic buyers for Peloton. The firm considered six metrics from cost synergies to the ability to sell new products. Warren Buffet’s Berkshire Hathaway, Adidas, Lululemon, Nike, Apple, Google, and Softbank checked every box.
Screenshot of Blackwells’ full presentation to the Peloton Board Blackwells Capital Blackwells, which has a 5% stake in Peloton, sent the presentation on February 7 ahead of the fitness company’s earnings report. It outlined the need for immediate change in leadership and demanded the board to initiate alternative internal processes.
Blackwells added to its January call to fire Foley for what it described as “gross mismanagement,” demanding that the New York-based firm replace its directors and investigate for possible misconduct.
“We believe the board should immediately begin to search for new, fully independent directors with no prior ties to the current board and management team,” Blackwells said in its presentation.
The activist investment firm, founded in 2016 by Jason Aintabi, said that potential buyers should be able to pay at least $65 per share while strategic buyers could pay $75 a share.
Peloton stock rallied on Tuesday, climbing around 24% after the company announced Foley will step down and the embattled bike-maker will cut 2,800 jobs.
Foley, who has been at the helm of the company for a decade, is set to become executive chairman. Former Spotify and Netflix CFO, Barry McCarthy, will replace Foley and join Peloton’s board.
Peloton, known for its exercise equipment and its on-demand fitness classes, was one of the biggest winners during the pandemic as people were stuck inside during COVID-19 lockdowns.
But the at-home fitness trend subsided as pandemic restrictions eased. In the fourth quarter, Peloton posted a net loss of $439.4 million, or $1.39 a share. The company slashed full-year revenue guidance to $3.7 billion to $3.8 billion, down from a prior outlook of $4.4 billion to $4.8 billion.
Deal icon An icon in the shape of a lightning bolt. Keep reading
More: MI Exclusive Markets Peloton peloton ceo Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options.