Activist investor pushes Peloton to sell shares

Activist investor pushes Peloton to sell shares

During the first quarter, the equity fell, and the fitness company replaced its CEO, under pressure from an activist investment firm, according to regulatory filings made by the firm's investment firms, Sachem Head Capital Management and Soros Fund Management.

Peloton, which makes exercise bikes and treadmills, faced heavy selling during the first quarter and into the second quarter as the pandemic eased and people returned to gyms.

The stock price has dropped 55% since January to close trading at $15.87 on Friday.

The filing late on Friday showed that Sachem Head sold 1.65 million shares during the first quarter. The firm, which sometimes pushes companies to perform better, first invested in Peloton late in 2021, when the stock price of the company was already falling. Soros Fund Management sold 335,557 shares.

Activist investment firm Blackwells Capital, which owns 5% of the company, has publicly pushed for changes in January. The company hired Barry McCarthy, a former Spotify and Nextflix executive, to replace co-founder John Foley as CEO of the company within a few weeks. Blackwells, which had pushed Peloton to sell itself, said in a recent presentation to it that it is unhappy with management.

Both Soros and Sachem Head released their 13 F filings on Friday that showed what money managers held at the end of the first quarter. While the filings are backward-looking, they are closely watched for hints on potential trends and insight into what specific stocks managers liked or soured on.

The deal was voted down by investors. In February, the Activist investment firm Jana Partners nominated four directors to sit on Zendesk's board and is pushing the company to review strategic alternatives and consider selling itself.