Will Blackwells Capital get the skin of John Foley? For some time now, the specialist in high-end exercise bikes and treadmills Peloton has been showing signs of weakness: disappointing results, not very encouraging outlook, production stoppage of certain equipment, fall in the stock market… In 2021 , the action has lost 76.4% of its value, and another 17% since the 1er January.
Lately, the future of the American group has darkened a little more. According to the American financial information site CNBC, Peloton would have mandated the management consulting firm McKinsey & Co. to help it restructure and reduce its payroll. It was enough to scald the activist fund Blackwells Capital. In a letter addressed to the board of directors of Peloton, he asks purely and simply for the departure of the managing director of Peloton, John Foley, whom he accuses of all the ills of the company. ” He should be fired immediately writes the fund, which holds just under 5% of the capital.
Redemption
” We believe the pandemic has presented Peloton with a tremendous and unexpected opportunity to accelerate consumer adoption of its product category and boost business performance and stock price. Now that the stock is trading below its IPO price and more than 80% below its record high, it is clear that the company, executives and board have squandered this opportunity. The rest of the letter is not tender. It concludes thus, pithy: Mr. Foley’s race is over. Now this board must independently chart a new path for Peloton. »
On the stock market, the prospect of seeing John Foley landed caused the title to jump 9.8% on Monday. Investors are also betting on a takeover of the company, which is called for by Blackwells Capital. ” The board should begin the sales process to maximize the value of Peloton’s brand, team, customer base and technology », Estimates the activist fund. For him, Peloton and its clientele could be the delight of a technology, streaming, metaverse or sports equipment company, such as Apple, Disney, Sony or Nike. ” They could expand their presence at home, in health and wellness, and on screen through Peloton. »
CP