Peloton (NASDAQ: PTON), a NYC-based interactive fitness platform, is to acquire Precor, a global commercial fitness equipment provider,in a transaction valued at $420m USD.
With the acquisition, expected to close in early calendar year 2021, Peloton plans to establish U.S. manufacturing capacity, boost research and development capabilities with Precor’s team, and accelerate penetration of the commercial market.
The company plans to produce connected fitness products in the U.S. before the end of the calendar year 2021. Subject to the completion of the transaction, Precor will operate as a business unit within Peloton. Precor President Rob Barker will become CEO, Precor and General Manager, Peloton Commercial, reporting to William Lynch, Peloton’s President.
Precor is a division of Finnish sporting goods company Amer Sports, which is owned by an investor consortium including ANTA Sports (HKG:2020.HK), FountainVest Partners, Anamered Investments Inc. and Tencent Holdings Limited.
The acquisition adds 625,000 square feet of U.S. manufacturing capacity with in-house tooling and fabrication, product development, and quality assurance capabilities in Whitsett, North Carolina and Woodinville, Washington. Peloton will be able to control the entire production process, from design to ship, and increase total production scale, while maintaining a high level of product quality.
The Precor U.S. facilities will join Peloton’s existing manufacturing network with its third party manufacturers and the Tonic facilities based in Taiwan. Once the transaction closes, the Precor U.S. facilities will provide Peloton with incremental operational scale and flexibility to support the growth of its connected fitness product line.
The acquisition would add a team of nearly 100 dedicated research and development employees to Peloton’s R&D team. The Precor team plans to work with the Peloton R&D team to design and create the next generation of connected fitness experiences.
Founded in 2012, Peloton is an interactive fitness platform, with a community of more than 3.6 million members. The company offers connected, technology-enabled fitness, and the streaming of immersive, instructor-led boutique classes for its Members anytime, anywhere. The brand’s content is accessible through the Peloton Bike, Bike+, Tread, Tread+ and Peloton App, which allows access to a full slate of fitness classes across disciplines, on any iOS or Android device, Apple TV, Fire TV, Roku TVs, and Chromecast and Android TV. Peloton has a growing number of retail showrooms across the U.S., UK, Canada and Germany.
Headquartered in Greater Seattle, WA, Precor provides products and services that span across all major categories, including cardio, strength, functional fitness, group training, and connected solutions. In 2020, the company reached the milestone of recording one billion workouts in its Preva® fitness cloud. Segments include commercial clubs/facilities and the verticals of Hospitality, Multi-family Housing, Corporate, and Education.