Months after abandoning a $650 million initial public offering due to unfavorable market conditions, iFIT Health & Fitness, formerly known as Icon Health & Fitness and parent of the NordicTrack, Weider and ProForm fitness brands, amongst others, has raised $355 million in capital from L. Catterton, the largest global consumer-focused private equity firm.
In a related development, which the company described as planned, iFit named CFO Steve Barr and Mark Watterson, its chief experience officer, as co-presidents of the organization headquartered in Logan, Utah. iFIT’s co-founder, chairman and CEO Scott Waterson will now serve exclusively as chairman of the board where he will work with iFit’s advanced development team on “next-generation product innovation.”
The iFIT-Catterton capital deal comes six weeks after a hedge fund, which advanced iFIT $200 million in 2019, sued over an alleged company violation of that loan agreement. Pamplona Capital executives were reportedly perturbed that iFIT was preparing to hand out an equity stake in the firm to an unspecified Chinese supplier.
The maker of bikes, treadmills, ellipticals and rowing machines acquired Sweat Group Pty Ltd., an Australian company with a digital fitness training platform for women, in late June 2021 for $37.5 million in cash, up to $70 million in deferred consideration and $40 million in Class A common stock after the IPO. The acquisition was followed by another in July 2021 with the purchase of 29029, a producer of endurance hiking events that simulate climbing Mount Everest.
But iFIT’s public offering never materialized in late 2021 as connected fitness category rival Peloton struggled with its business and global demand for at-home fitness products, which had risen dramatically during the pandemic, slowed.
Public filings ahead of the proposed IPO pulled back the curtain on iFIT’s recent financial results. In the fiscal year ended May 31, 2021, the company generated a 104 percent year-over-year increase in total revenues to nearly $1.75 billion but posted an operating loss of $127,634 and a net loss of $516,706. The NordicTrack brand (53 percent) accounted for more than half the topline followed by ProForm (27 percent), iFIT subscriptions (13 percent), Weider (6 percent) and Freemotion (1 percent). The shareholder deficit at fiscal year-end was $670,159, up from a deficit of $181,156 on May 31, 2020. In fiscal 2020, iFIT had a 21.7 percent in year-over-year revenues to nearly $851.9 million but reported an operating loss of almost $49.8 million and a net loss of $98.5 million. The last year that iFIT turned a profit was in 2019 when it made nearly $56.6 million on total revenues of $699,965,000.
