Lululemon buys at-home exercise startup for $500 million

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NEW YORK (AP) — Athletic apparel maker Lululemon Athletica Inc. said Monday it’s acquiring at-home exercise startup Mirror for $500 million.

The deal is part of Lululemon’s plan to expand beyond just selling yoga tights and other workout clothing.

“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 sweat life,” Lululemon CEO Calvin McDonald said in a statement.

The move also comes as Americans have been forced by gym closures to work out at home during the pandemic. And even as some gyms have reopened with new safety protocols, many customers are still not willing to go back because of worries about catching the virus.

Mirror, which launched in 2018, sells a $1,500 interactive mirror that streams workout classes, offers weekly live classes and thousands of on-demand workouts, as well as immersive one-on-one personal training.

The deal builds on a partnership between the two companies that began in mid-2019 when Lululemon made an initial investment in Mirror.

It also marks Lululemon’s first acquisition. Once the deal closes, Mirror will operate as a standalone company within Lululemon, which is based in Vancouver, British Columbia.

Brynn Putnam will continue as Mirror’s CEO, reporting to McDonald.

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Through no fault of theirs, the novel coronavirus has put some retailers on the edge of bankruptcy. And as you’ve seen, many have fallen over that edge including iconic names like Nieman Marcus, J.C. Penney and J.Crew.

In fact, according to the American Bankruptcy Institute, there were 560 commercial Chapter 11 filings in April. That was a 26% increase over last year. And executive director, Amy Quakenboss, suggests that there are more to come.

“As financial challenges continue to escalate amid this crisis,” observes Quakenboss, “bankruptcy is sure to offer a financial safe harbor from the economic storm.”

With no revenue walking through the door, many retailers are seeing a semblance of revenue from e-commerce sales. But for some retailers, the shutdown is more impactful because they didn’t have a strong e-commerce structure. That means that they rely more than others on brick-and-mortar sales.

The real question now is will there really be the pent-up demand that some analysts still swear is just waiting to be unleashed. It may indeed exist. Time will tell. But time is not a commodity many of these retailers have. And we’ve identified five retailers for which the clock is not in their favor.

View the “The Next 5 Retailers on the Edge of Bankruptcy”.