- Peloton Interactive, Inc PTON co-founder and former CEO John Foley faced repeated margin calls on the money he borrowed against his Peloton holdings before he quit the board in September.
- As Peloton's shares slipped over the past year, Goldman Sachs Group, Inc GS asked Foley several times to provide fresh funds or additional collateral for personal loans the bank had extended to him, the Wall Street Journal reported.
- Peloton's share price plummeted nearly 95% from its $160 peak in December 2020.
- Also Read: Fitness Equipment Maker Peloton Lays Off Around 500 Staff To Save Its Struggling Business: Report
- Resigning from the board gave Foley flexibility to sell or pledge more Peloton shares, though he said the margin calls were not why he left the company.
- Foley had pledged about 3.5 million Peloton shares as collateral as of September 2021. It was equivalent to 20% of his stake at the time.
- The pledged shares were worth more than $300 million a year ago. At current prices, they are worth roughly $30 million.
- Foley managed to secure private financing and avoid stock sales by Goldman.
- Foley's decision to quit the board in September after several months, and a sharp decline in his wealth as Peloton's sagging fortunes, diminished the value of his holdings. His stake in the company, worth $1.5 billion a year ago, is currently worth less than $100 million.
- In February, Foley stepped down as CEO.
- Foley kept his position as Peloton's executive Chair and held a controlling stake in the company.
- Price Action: PTON shares traded lower by 7.37% at $8.42 on the last check Tuesday.
- Photo via Wikimedia Commons
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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