Peloton announces US$420 million acquisition of fitness equipment brand Precor

December 22, 2020

US-based fitness and media company Peloton has advised that it is to acquire the Precor equipment brand from current owner Amer Sports in a deal worth a reported US$420 million.

With Peleton having enjoyed a highly successful year, the acquisition of Precor, which will include 58,000 metre² of North American manufacturing space will speed up production of its cycles and treadmills and meet its promised delivery windows.

Demand for Peloton’s exercise equipment has surged during the Coronavirus pandemic, straining its supply chain, as consumers look to work out at home.

The deal also boosts Peloton’s product development efforts, by adding nearly 100 research-and-development employees to its existing staff.

With Precor to operate as a business unit within Peloton, current Precor President, Rob Barker will become Chief Executive of Precor and General Manager of Peloton Commercial, reporting to Peloton President, William Lynch.

In a statement, Lynch (pictured below) advised “by combining our talented and committed R&D and Supply Chain teams with the incredibly capable Precor team and their decades of experience, we believe we will be able to lead the global connected fitness market in both innovation and scale.”

With Peloton advising in November that it would be operating under supply constraints “for the foreseeable future” due to the heightened demand for its products, its stock jumped more than 8% following the acquisition announcement. Peloton expects Precor to introduce the combined company to new markets.

Founded in 2012, Peloton's main products include an indoor cycle treadmill that allow monthly subscribers to remotely participate in classes streamed from the company's fitness studio.

As sales have surged this year, Peloton customers have reported delayed shipments and poor service.

For 40 years, Precor has been a pioneer in creating quality fitness experiences introducing the world’s first elliptical in 1995 and the fitness industry’s first capacitive touchscreen in 2010.

Commenting on the sale, Barker, also an Executive Board Member at Amer Sports, noted “I genuinely believe that this (will) be an excellent move for Precor and Peloton and that once this transaction is completed, we (can) look forward to an exciting future together.”

Looking back on this year, he noted “in 2020, Precor surpassed the milestone of recording one billion workouts in its networked fitness cloud. That number represents an aggregate of more than 140,000 connected cardio units in over 13,000 commercial facilities. We also introduced the market to our 21-piece Resolute™ Selectorized Strength Line.

“We further innovated for you and your exercisers by leveraging our strong digital partnerships via Advagym by Sony and eGym Digital to deliver solutions that helped you stay connected to your members. Our net promoter score increased to 46, moving from ‘great’ to ‘excellent’.

“We also protected our communities and healthcare workers by utilising our upholstery team's skills to deliver PPE.”

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