New Peloton chief bats away takeover talks after Amazon and Nike investor buzz

Peloton’s new chief exec has denied claims that the firm is gearing up for sale, subduing investor excitement that the fitness company was about to be scooped up by Amazon or Nike.

Shares surged last week after reports that the ecommerce giants were eyeing up the New York based company. 

However, Barry McCarthy, the former finance chief of Netflix and Spotify, who was appointed as top dog last week, told the Financial Times that he was moving from California to New York to seize a long-term growth opportunity, not to oversee a sale.

“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,” he said. “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.”

After riding the pandemic high to an eyewatering $50bn valuation 12 months ago, Peloton has backpedalled to a humbler $8bn capitalisation.

Activist investor Blackwells Capital, which owns a little under five per cent of the company, accused former boss and co-founder John Foley of misleading investors and hiring his wife in an executive role which it claims wiped $40bn off shareholder income.

There has also been dwindling demand as gyms and offices open up. 

This can be seen by reports that Peloton will be temporarily halting production during February and March of its bikes and treadmills amid collapsing demand.

In terms of potential takeovers, whilst Foley is no longer CEO, he still has immense voting power within the company, and would be able to influence any decisions about a potential sale as an executive chair.

Blackwells backs Peloton finding a buyer, however, as City A.M. reported last week, the appointment McCarthy, an experienced streaming boss, may be an interesting signal that Peloton might be focussed on the online offering rather than the infrastructure itself.

Shares were down just over one per cent on Wall Street.