New Peloton CEO dismisses rumours of sale
Peloton’s new chief executive Barry McCarthy has dismissed the idea that the fitness tech company could be put up for sale.
McCarthy has instead promised to pursue growth by doubling down on content and expanding to new countries while it expands its product portfolio.
The company‘s share price rallied last week after it was reported Nike and Amazon were interesting in buying out the brand after it saw its market value crash by over 80%.
“If I thought it was likely that the business was going to be acquired in the foreseeable future, I can’t imagine it would be a rational act to move across the country,” McCarthy told the Financial Times.
“There are lots of other things I could be doing with my time that are quite lucrative than hanging out with a business that’s about to be sold.”
While McCarthy affirmed his desire for the brand to not sell itself off to a larger player, the decision is in the hands of Peloton insiders who command the majority of the vote, which includes ex-chief executive John Foley
“It’s not my vote,” McCarthy said.
“It is, however, the vote of the shareholders, and I’m confident a large percentage of the votes will be cast in favour of my leadership of the business, which is why I agreed to step into the business in the first place.”
One of Peloton’s activist investors Blackwells Capital had urged the fitness-tech brand to find itself a buyer and scrap its dual-class voting structure.
McCarthy however is focussed on restoring the brand’s public image and valuation, mainly by concentrating on expanding the digital community and make Peloton “a very fast-growing business with very high margins”, he said.
His strategy will include developing “product line extensions” so customers could own multiple machines and added that “an entirely different pricing structure” could replace the $39 monthly subscription fee which has been static since the company sold its first bikes via Kickstarter.