Peloton Completes Major Refinancing
Krissy Vann | Host, All Things Fitness and Wellness
Peloton has announced the successful completion of a comprehensive refinancing initiative. This strategic move aims to reduce overall debt, extend debt maturities, and achieve more flexible loan terms.
Peloton secured a new $1 billion five-year term loan facility, involving a wide range of investors. Additionally, the company raised $350 million from new and existing investors through an upsized private offering of convertible senior notes due in 2029. Furthermore, Peloton obtained a new $100 million five-year revolving credit facility with JP Morgan and Goldman Sachs.
The proceeds from these transactions, along with cash on hand, were used to repurchase approximately $800 million of 0% convertible senior notes due in 2026 at a discount. This refinancing also covered the costs of refinancing existing term loans and revolving credit facilities, as well as related fees and expenses.
Liz Coddington, Peloton’s Chief Financial Officer, expressed her satisfaction with the refinancing efforts. "On behalf of the entire Peloton leadership team, we're delighted with the incredible show of support that we received from new and existing investors who contributed to our oversubscribed and competitively priced refinancing. Notably, we achieved our refinancing goals of modestly deleveraging and extending our maturities at a reasonable blended cost of capital," she stated. "This successful outcome underscores the resilience of our subscription business and signifies a tremendous vote of confidence in Peloton's future. We are now operating from stronger financial footing and are well positioned to continue to provide the best fitness experience for our Members and deliver sustainable, profitable growth for our shareholders."
Peloton worked with its lead banks, JP Morgan and Goldman Sachs, and its financial advisor, BDT & MSD Partners, to complete this holistic refinancing.
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