Why Lululemon Athletica's $500 Million Acquisition of MIRROR Makes Perfect Sense
On June 29, Lululemon Athletica (NASDAQ: LULU) announced a strategically important move to acquire MIRROR for $500 million. MIRROR makes digital workout displays that it sells through its website for $1,495. It operates in the same interactive fitness space as Peloton Interactive (NASDAQ: PTON), so there is plenty of competition. The deal will be funded with Lululemon's available liquidity sources, including over $800 million of cash. MIRROR will continue to operate as a stand-alone company.
The upstart fitness brand was founded by Brynn Putnam, a former Lululemon ambassador, and launched just two years ago. The two companies collaborated last year on content after Lululemon made an initial investment in MIRROR. Several Lululemon ambassadors have launched content on MIRROR recently, making the deal a natural progression of how the two brands were already working together.
Now that MIRROR will operate as part of Lululemon, management has big plans that could be very beneficial for both companies. Here is why Lululemon and MIRROR make a perfect, and powerful, combo in the world of fitness.
Source Fool.com
