Peloton co-founder John Foley, who resigned as the company’s chief executive last month, appears to be looking for liquidity after selling $ 50 million in cash and quietly looking for buyers for the $ 55 million Hamptons, which he bought just months ago.
Foley, who remains Peloton’s chief executive, sold the shares in a privately negotiated deal to an investment firm backed by technology billionaire Michael Dell, regulatory documents showed on Wednesday.
Last month, ex Netflix and Spotify CEO Barry McCarthy replaced Foley as chief executive, but said the co-founder would remain active in Peloton despite criticism for a series of management mistakes during the pandemic.
Even after the sale of the shares, Foley owns enough shares in Peloton to maintain control of the voice over the company.
Peloton co-founder John Foley, who resigned as the company’s chief executive last month, appears to be looking for liquidity after selling $ 50 million in cash and quietly looking for home buyers
Foley and his wife Jill are reportedly quietly looking for a private buyer for their sprawling location in the East Hamptons for less than they bought.
They bought the four-acre home on the ocean in December for $ 55 million, $ 2.5 million above asking price.
Shares of Peloton fell more than 75% in the last year after a series of mistakes
Last year, Foley sold about $ 100 million worth of shares in the company, but most of his previous sales were over $ 110 per share.
Dell’s investment firm, MSD Partners, was sold at $ 26 a share after Peloton’s shares fell more than 75 percent last year.
Shares closed at $ 24.52 on Thursday, down 8.3% for the day.
That’s what a Peloton spokesman said CNBC that Foley’s share sale was “based on his own financial planning”.
MSD Partners CEO Greg Lemkau told the publication: “Peloton is an exceptional brand and MSD Partners is pleased to have this opportunity to support Barry McCarthy and the Peloton team as they position the business for long-term growth.”
Foley and his wife, Jill, meanwhile, are also quietly looking for a private buyer for their extensive East Hampton complex for less than they bought, according to New York Post.
They bought the four-acre home on the ocean in December for $ 55 million, $ 2.5 million more than the asking price. It is now back on sale at last year’s original asking price.
Designed by Francis Fleetwood, the 6,100-square-foot mansion has five bedrooms, a chef’s kitchen and a variety of terraces.
Foley reportedly seeks to unload his Hampton mansion for less than he paid
Designed by Francis Fleetwood, the 6,100-square-foot mansion features five bedrooms, a chef’s kitchen and many sun loungers.
The property boasts a number of outdoor amenities as well as access to the beach
Foley rose high during Peloton’s pandemic sales jump and was flattered New York Times a late-2020 profile depicting him hauling firewood to his West Village townhouse, where he keeps a Peloton treadmill in his basement bathroom.
But the praise soon turned into criticism for a number of PR incidents and falling Peloton stock prices.
In December, Foley was criticized for organizing a party only with invitations to top instructors at the iconic Plaza Hotel in New York, although he canceled the company’s company-wide holiday.
The boss hosted a chic party at a famous five-star hotel near Central Park on December 8th, with photos of the gleaming entertainment shared on social media by glamorous Peloton instructors who were among the invited VIPs.
The co-founder of Peloton claims that the party was a “personal” event organized by him for “vaccinated family and friends” and was not related to Peloton, according to an email for the entire company seen by The New York Post.
But that apology cut some ice with the vast majority of the company’s employees, whose own party was canceled due to the jump in Omicron COVID and the company’s falling share price.
While Peloton’s shares rose during the pandemic, when home fitness flourished, they have since collapsed and the company has faced criticism for investing too much in expansion plans during a boom that was unsustainable.
In December, Foley was criticized for organizing a party only by inviting top instructors at the iconic Plaza Hotel in New York, although he canceled the company’s company-wide holiday.
Photos and videos show attendees (pictured: Aditi Shah and Kendall Tull) dancing all night in a room beautifully decorated with a disco ball
While Peloton’s shares rose during the pandemic, while fitness at home flourished, they have since collapsed and the company has faced criticism for investing too much in expansion.
Foley drew the ire of activist investor Blackwells Capital as the company struggled to sustain the staggering growth that brought its valuation to $ 52 billion in early 2021.
The investment firm called for its removal and even called for the company to be sold, blaming the poor performance of “gross mismanagement” shares, poor Foley’s decision-making and lack of trust.
Jason Intaby, Blackwells’ chief investment officer, accused Foley of “repeated failures”, including hiring his wife as vice president of apparel.
In February, Foley resigned as chief executive as Peloton announced a dramatic reorganization and cost-cutting plan, along with 2,800 layoffs in a bid to support spending.
The company expects to spend about $ 130 million in cash on compensation packages as part of the restructuring, as well as $ 80 million in non-monetary costs.
The cuts are aimed only at corporate staff and will not affect Peloton’s fitness instructors, some of whom have become quasi-celebrities with many followers.
Peloton will halt the development of its planned Ohio plant, which is expected to invest about $ 400 million and create more than 2,000 jobs over the next few years.
Overall, the company said its restructuring changes would save it about $ 800 million a year in reduced costs.