Under Armour completes sale of the MyFitnessPal platform to Francisco Partners
The company first announced that it would sell MyFitnessPal to Francisco Partners for a total of $345 million in October. At the time, the announcement caused the athleticwear company's shares to rise by 1.58%.
Launched in 2005, MyFitnessPal is a diet and fitness app and website that allows users to log their food intake and track their nutrition, as well as their exercise. The app was bought by Under Armour in 2015, at a time when MyFitnessPal had over 80 million users, for $475 million. Over time, the number of users on the app grew to over 200 million.
In 2018, Under Armour's shares dropped by 3.8% after the company announced that MyFitnessPal had been hacked, placing the username, email address, and password information of about 150 million of the app's users at risk.
Debt financing for the sale was provided by MidCap Financial.
"As part of our ongoing transformation, we are committed to actively managing our business to ensure that our strategies and assets are prioritized to connect even more deeply with our target consumer – the Focused Performer," Under Armour president and CEO, Patrik Frisk, said in October.
"This announcement reduces the complexity of our consumer's brand journey by empowering sharper alignment with our long-term digital strategy as we work towards a singular, cohesive UA ecosystem. Additionally, it affords us investment flexibility to drive greater return and value to our shareholders over the long-run."
In October, Under Armour beat quarterly revenue estimates, thanks in part to online demand for athletic apparel and sneakers, as more consumers work out at home or outside during the Covid-19 pandemic. The boost marked a bright spot for Under Armour after the company saw its revenue plummet by 41% in the second quarter, as the pandemic caused physical stores to temporarily shut down.
The company predicted its full year 2020 revenue to be down by a percentage in the high-teens, a significant improvement from the 25.7% drop previously predicted by analysts.
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