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lululemon athletica noted its plans to buy MIRROR by way of a press release, noting that it hopes to close the sale by the end of the second fiscal quarter of this year.
American athletic apparel retailer lululemon athletica Inc (NASDAQ: LULU) said that it has entered into a deal to buy MIRROR. The buying price is said to be $500 million.
LULU stock is growing after the news. Yesterday it gained over 1.6% in the trading session and then went up nearly 4% after house to trade at $305.75.
With its best-in-class essence and accomplished platform, MIRROR puts lululemon to advance its vision and build upon an ecosystem that will fuel the “Company’s Power of Three growth plan”, which includes driving the business through omni-channel guest experiences.
MIRROR will boost the firm’s offerings and bring enveloping and personalized in-home sweat, and alertness solutions to new and existing lululemon guests.
Calvin McDonald, Chief Executive Officer said:
“In 2019, we detailed our vision to be the experiential brand that ignites a community of people living the sweatlife through sweat, grow and connect. The acquisition of MIRROR is an exciting opportunity to build upon that vision, enhance our digital and interactive capabilities, and deepen our roots in the sweatlife. We look forward to learning from and working with Brynn Putnam and the team at MIRROR to accelerate the growth of personalized in-home fitness.”
MIRROR offers weekly live classes and thousands of on-demand workouts as well as immersive one-on-one personal training. The company has seen quick growth and strong engagement since it started in 2018 as demand for in-home fitness offerings continue to increase significantly.
This transaction created on a partnership between the two firms, which began in mid-2019 with an initial investment in MIRROR by lululemon, and also includes a content partnership that brought sweat and meditation classes to the MIRROR platform by lululemon’s Global Ambassadors.
Mirror to Operate as Standalone Company after Deal with lululemon
The buying price is expected to be paid from the company’s primary sources of liquidity, which include over $800 million in cash, its existing $400 million revolving credit facility, and a new one-year, $300 million revolving credit facility.
Following the completion of the transaction, MIRROR will operate as a standalone company within lululemon and Ms. Brynn Putnam will continue as MIRROR’s chief executive officer, reporting to Mr. McDonald. The transaction is subject to customary closing conditions and is expected to close in the second quarter of fiscal 2020.