Miss managed hyper-growth, activist investors, unhappy staff, a tight business model, bad press and tumbling stock price. All in a day's work for Peloton Interactive inc.
John Foley, the founder, must be feeling the pressure as the financial opinion compactor crushes him from all sides. He is likely finding it hard to remember that he built a very valuable technology platform.
The deal that's yets to be done.
So, where does M&A play into the Peloton story? Well, I would have thought Peloton is now firmly in the acquisition crosshairs of several brands that could make the platform work. Nike, Apple are the obvious front runners as both carry established fitness platforms. The FT mention Sony as a runner, which also makes some sense.
However, suppose I was in the position to be making a call. In that case, I'd see this as a massive opportunity for someone like The Hut Group (one of only a handful of publically listed sports supplement companies) to raise some serious cash from their shareholders (BlackRock, SoftBank, Balderton) and make a run at a deal.
THG, like the Pelton, has had a bumpy ride of late due to both short-sellers and misaligned business models. Personally, I feel two wrongs do actually make a right in this case. It will be interesting to see who makes a move first.
Remember, it's not all PLCs, activist shareholders in M&A. Far from it. Most businesses can use some form of this strategy to grow via merger or acquisition.
If you want to know more about how your business can grow with M&A, our diary is always open for bookings, so please drop me a message, or schedule a call on the meeting link in the comments.
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