At Extreme Investor Network, we are your go-to source for the latest business news and updates that impact the financial world. Today, we are diving into the recent news surrounding Peloton, the popular connected fitness company.
Peloton shares took a hit recently after the company announced a “global refinancing” plan in an effort to manage a cash crunch amidst declining sales. The company is making moves to offer $275 million in convertible senior notes due in 2029 through a private offering. Additionally, Peloton plans to secure a $1 billion five-year term loan and a $100 million revolving credit facility.
The goal of this refinancing is to buy back approximately $800 million of its 0% convertible senior notes due in 2026 and refinance existing loans. This news caused Peloton shares to drop more than 12% in extended trading, although they did recover some ground later on.
Last month, Peloton announced the departure of CEO Barry McCarthy and revealed plans to cut 15% of its workforce in an effort to align spending with revenue. The company is focused on improving its cash position as demand for connected fitness products continues to decline.
In a letter to shareholders, Peloton expressed its commitment to managing its debt maturities and is working closely with lenders like JPMorgan and Goldman Sachs on a refinancing strategy. The company aims to deleverage, extend maturities, and secure a reasonable cost of capital.
Stay tuned to Extreme Investor Network for more updates on Peloton’s refinancing efforts and other important financial news. We are dedicated to providing you with unique insights and valuable information to help you navigate the ever-changing business landscape.