John Foley, co-founder and chief executive officer of Peloton Interactive Inc., center left, rings the opening bell during the company's initial public offering at the Nasdaq MarketSite in New York on Sept. 26, 2019. Peloton fell as much as 9.5% Thursday after raising $1.16 billion in its U.S. IPO, becoming the latest unprofitable startup to fail to win over investors in its trading debut. (Photo: Michael Nagle/Bloomberg)Fenwick & West, Latham & Watkins Bag $2.55M for Peloton's IPO
Peloton's stock opened at $27 on Thursday with a total market value of $7.7 billion.
September 26, 2019 at 04:39 PM
3 minute read
Peloton Interactive Inc., the fitness startup known for on-demand workout programs on its exercise bikes, is now a public company.
In its updated IPO prospectus, filed on Wednesday, Peloton said it expects to raise $1.16 billion in the IPO and initially valued the company at $8.1 billion. The amended S-1 filing also revealed that its two law firms, Fenwick & West and Latham & Watkins, are getting $2.55 million in legal fees and expenses for the digital fitness company's IPO work.
Fenwick has grabbed the lead role for Peloton's IPO, while Latham is representing the underwriters, a group of 21 financial institutions and advisory firms that include Goldman Sachs & Co. and JPMorgan Securities.
Peloton's stock opened at $27 on Thursday, nearly 7% lower than the $29 IPO price that the company set last night. At $27 a share, Peloton has a total market value of $7.7 billion. Peloton is one of a handful of notable IPOs this year to fall on its first day of trading.
The $2.55 million in legal fees and expenses paid by the company is more than most of the tech unicorns that went public early in the year paid their firms, but still lower than the $5.5 million Uber paid for legal costs related to its mega IPO in May.
Fenwick's lawyers also own a total of 6,926 shares of Peloton's Series F redeemable convertible preferred stock, which will convert to Class B common stock, Peloton disclosed in its filling. The company's dual-class structure gives Class A common stockholders one vote per share, while reserving 20 votes per share for Class B shareholders. The Class B common shares are owned by executives and early investors.
The filing also revealed that Peloton CEO and co-founder John Foley owns close to 15.17 million of the company's Class B common shares, giving him 6.2% of the voting power. Peloton president William Lynch has 3.1% voting power with 7.5 million shares, while chief financial officer Jill Woodworth has 1.5% with 3.5 million shares.
Venture capitalist Jon Callaghan has greatest individual voting power at 12%, with 28.37 million shares.
The IPO papers also disclosed Hisao Kushi, Peloton's chief legal officer and secretary, got $4.6 million for selling 320,000 shares of the company's common stock in a tender offer last year.
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