Shares of Peloton (PTON) jumped more than 20% in premarket trading on media reports that the connected fitness company is attracting interest from potential buyers, including Amazon (AMZN).
The Wall Street Journal reported over the weekend that Amazon has been speaking to advisers about a potential deal. There’s no guarantee the tech giant will follow through with an offer or that Peloton, which is working with its own advisers, would be receptive to an approach.
Other potential suitors are also circling Peloton, according to media reports.
Peloton was a darling of the pandemic as people at home during lockdowns turned to its fitness bikes and online classes for exercise. But shares have fallen more than 80% from their high a year ago as the gradual easing of pandemic restrictions fueled concern that growth would slow.
Activist investor Blackwells Capital last month issued a letter demanding the company fire co-founder and Chief Executive Officer John Foley and pursue a sale. Blackwells said potential buyers could include Apple (AAPL), Walt Disney Co. (DIS), and Nike (NKE).
Amazon’s interest may be linked to its effort to gain a greater role in healthcare, as well as the potential to market to Peloton’s almost three million monthly subscribers.
In 2020, Amazon introduced its wearable Halo products to compete with Google-owned Fitbit and other fitness devices
Peloton’s shares jumped to a high of $35.25 U.S. in extended trading after closing last Friday (February 4) at $24.60 U.S., below its September 2019 initial public offering (IPO) price of $29 U.S.
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