Interactive Strength Inc. (Nasdaq:TRNR) Signs Binding Agreement to Acquire Sportstech, a Profitable $40M+ Revenue Connected-Fitness Equipment Business

Rhea-AI Summary

Interactive Strength (NASDAQ:TRNR) has signed a binding agreement to acquire Sportstech, Germany's largest connected fitness equipment company. The acquisition, expected to close by April 1, 2025, will create a scaled international operation in the US and German markets.

Key highlights of the deal:

• TRNR projects over $50M in revenue for 2025 and expects to achieve EBITDA profitability in H2 2025
• Sportstech has served nearly 3 million customers since 2012, achieving profitability without external capital
• The deal represents TRNR's second acquisition within 12 months
• The combined entity will leverage TRNR's Nasdaq listing and global presence to accelerate Sportstech's growth, particularly in the US market

The acquisition aligns with TRNR's strategy of building shareholder value through accretive acquisitions in the fragmented global health & wellness market.

Positive

• Expected to achieve EBITDA profitability in H2 2025
• Projected revenue of $50M+ in 2025 on pro forma basis
• Acquiring a profitable business with established customer base (3M customers)
• Immediate accretive impact on TRNR's results
• Expansion into Germany, the second-largest fitness market globally

Negative

• None.

Insights

M&A Strategy Analyst

This strategic acquisition represents a transformative moment for Interactive Strength, positioning it as a significant player in the global connected fitness market. The deal structure reveals several compelling strategic advantages:

Market Leadership & Geographic Expansion: By combining TRNR's US presence with Sportstech's German market dominance, the merged entity gains immediate scale in the world's two largest fitness markets. This dual-market presence provides natural hedging against regional market fluctuations and creates a robust platform for global expansion.

Financial Impact & Operational Efficiency: Sportstech brings immediate value with its $40M+ revenue and established profitability. The projected combined revenue of $50M+ for 2025 and expected EBITDA profitability in H2 '25 suggest significant operational synergies. Notably, Sportstech's achievement of profitability without external capital demonstrates strong operational efficiency and cost management.

Strategic Market Consolidation: This acquisition, TRNR's second in 12 months, reveals a clear roll-up strategy in the fragmented health & wellness market. The combination of CLMBR and FORME brands with Sportstech's equipment portfolio creates a diverse product offering that can address various customer segments and price points.

Growth Catalysts: Key value drivers include:

• Cross-selling opportunities across combined 3 million customer base
• Operational synergies in supply chain and R&D
• Enhanced distribution networks in both US and European markets
• Accelerated product development through combined technological capabilities

The deal's immediate accretive nature and the complementary business models suggest a well-thought-out integration strategy that could serve as a template for future acquisitions in TRNR's consolidation playbook.

TRNR is expected to generate more than $50M in revenue in 2025 on a pro forma basis and achieve EBITDA profitability in H2 ‘25

Sportstech is founder-led, having achieved profitability and scale without raising capital and has successfully sold equipment to almost 3 million customers since 2012

TRNR Listing and global presence to help Sportstech accelerate growth beyond core markets, most notably the US; Sportstech's scaled, profitable business to drive step-change for TRNR top and bottom lines

Transaction delivers on previously-announced LOI, combines highly complementary businesses to create a scaled, international operation anchored in the US and Germany, the #1 and #2 fitness markets globally

Deal - TRNR's second within 12 months - advances its strategy for building shareholder value through accretive acquisitions of profitable, growth businesses in the fragmented global health & wellness market

TRNR CEO to discuss transaction at 2025 Connected: Health & Fitness Summit today in Los Angeles

AUSTIN, TX / ACCESS Newswire / February 11, 2025 / Interactive Strength Inc. (NASDAQ:TRNR) ("TRNR" or "the Company"), maker of innovative specialty fitness equipment under the CLMBR and FORME brands, today announced it had signed a binding transaction agreement to acquire Sportstech Brands Holding GMBH ("Sportstech"), the largest connected fitness and equipment company in Germany. The binding transaction agreement marks an expected milestone in the acquisition process, following TRNR's previously-announced non-binding LOI with Sportstech - and combines businesses with highly complementary operations to create a scaled group anchored in the US and Germany, the two largest fitness markets in the world. The deal is expected to close as early as April 1, 2025 and will be immediately accretive to TRNR's results.

"This is a huge leap forward for both Interactive Strength and Sportstech, dramatically accelerating the combined company's ability to serve both consumers and businesses and grow globally," said TRNR Founder and CEO Trent Ward. "In Ali and Sportstech, we have the ideal partner - an experienced and successful Founder of a highly-complementary fitness platform who bootstrapped his way to eight figures in profitable revenue and is motivated to grow even further and faster. This is a proud day for the teams from both companies and a major boost for our ability to create shareholder value."

"At Sportstech, we're focused on a world where fitness and health are accessible to everyone and attractive to anyone," said Ali Ahmad, Founder and CEO. "TRNR's equipment, distribution and finance experience as well as its Nasdaq listing represent the resources our employees and customers need to grow our fitness community without sacrificing quality of experience or outcomes. We're very excited to bring our mission of helping everyone achieve their fitness goals to even more people, across more markets."

Mr. Ward continued: "The global health & wellness market is growing, but also fragmented. There's a significant opportunity to create shareholder value by consolidating a portfolio of quality businesses that offer a variety of equipment, training and content to different types of customers, across many markets. Sportstech is exactly that kind of business, with an experienced, sophisticated team that's also passionate about fitness."

About Sportstech Brands Holding GMBH
Sportstech is a profitable, $40M+ revenue company based in Germany that serves customers in the DACH region (Germany, Austria and Switzerland), France and Spain. It offers customers unique fitness equipment and app-based fitness content that's designed to fit in with busy lifestyles and motivate anyone to achieve a healthier, more active lifestyle. Founded by CEO Ali Ahmad in 2012, as an outgrowth of his own personal journey to a happier, fitter and healthier life, Sportstech offers a uniquely successful combination of technology, branded equipment and training-oriented community in the health and wellness space.

Transaction Overview

• TRNR will acquire 99% of Sportstech in an all-stock transaction, with an initial consideration of $15M in non-voting convertible preferred stock, with the conversion price to be determined by using the volume-weighted average price of the 20 trading days immediately prior to June 15, 2026, subject to compliance with Nasdaq Listing Rule 5635(d).

• There is the potential for future stock-based earnouts in three tranches, contingent upon specific EBITDA-performance targets for the business as of March 2026 and March 2027, that could total an additional $40M, upon achieving a cumulative EBITDA of more than $25M over the 24 months from April 2025 to March 2027.

• This performance-driven valuation structure, with up to 73% of the total consideration being contingent upon future earnings, protects the TRNR shareholders and should ensure an attractive acquisition multiple of earnings.

• The Sportstech shareholder is exchanging all of his equity to become a long-term shareholder in the combined company, with an extended "lock-up" of 45% of the maximum consideration until June 2026 and 55% until June 2027. There is no cash consideration being paid to the Sportstech shareholder.

• Sportstech Founder and CEO, Ali Ahmad, will join the TRNR Board upon closing of the transaction.

• The acquisition does not have a financing contingency.

For more information the Company's investor website as well as its required filings with the US Securities & Exchange Commission (SEC).

TRNR Investor Contact
ir@interactivestrength.com

TRNR Media Contact
forme@jacktaylorpr.com

About Interactive Strength Inc.:
Interactive Strength Inc. produces innovative specialty fitness equipment and digital fitness services under two main brands: 1) CLMBR and 2) FORME. Interactive Strength Inc. is listed on NASDAQ (symbol:TRNR).

CLMBR is a vertical climbing machine that offers an efficient and effective full-body strength and cardio workout. CLMBR's design is compact and easy to move - making it perfect for commercial or in-home use. With its low impact and ergonomic movement, CLMBR is safe for most ages and levels of ability and can be found at gyms and fitness studios, hotels, and physical therapy facilities, as well as available for consumers at home. www.clmbr.com.

FORME is a digital fitness platform that combines premium smart gyms with live virtual personal training and coaching to deliver an immersive experience and better outcomes for both consumers and trainers. FORME delivers an immersive and dynamic fitness experience through two connected hardware products: 1) The FORME Studio Lift (fitness mirror and cable-based digital resistance) and 2) The FORME Studio (fitness mirror). In addition to the company's connected fitness hardware products, FORME offers expert personal training and health coaching in different formats and price points through Video On-Demand, Custom Training, and Live 1:1 virtual personal training. www.formelife.com.

Forward-Looking Statements:
This press release includes certain statements that are "forward-looking statements" for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements do not relate strictly to historical or current facts and reflect management's assumptions, views, plans, objectives and projections about the future. Forward-looking statements generally are accompanied by words such as "believe", "project", "expect", "anticipate", "estimate", "intend", "strategy", "future", "opportunity", "plan", "may", "should", "will", "would", "will be", "will continue", "will likely result" or similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding the possibility of completing this or other acquisitions, as well as the acquisition being accretive to the Company's financial results, as well as projections of the revenue for 2025 and achieving profitability in the second half of 2025. The reader is cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of the Company. Risks and uncertainties include but are not limited to: demand for our products; competition, including technological advances made by and new products released by our competitors; our ability to accurately forecast consumer demand for our products and adequately maintain our inventory; and our reliance on a limited number of suppliers and distributors for our products. A further list and descriptions of these risks, uncertainties and other factors can be found in filings with the Securities and Exchange Commission. To the extent permitted under applicable law, the Company assumes no obligation to update any forward-looking statements.

Contact Information
John McNamara
IR
john@tradigitalir.com
917-658-2602

SOURCE: Interactive Strength Inc.

View the original press release on ACCESS Newswire

FAQ

When will TRNR's acquisition of Sportstech close?

The acquisition is expected to close as early as April 1, 2025.

What is the projected revenue for TRNR after the Sportstech acquisition?

TRNR expects to generate more than $50 million in revenue in 2025 on a pro forma basis.

How many customers has Sportstech served since its founding?

Sportstech has successfully sold equipment to almost 3 million customers since 2012.

When does TRNR expect to achieve EBITDA profitability following the Sportstech acquisition?

TRNR expects to achieve EBITDA profitability in the second half of 2025.

How will the Sportstech acquisition impact TRNR's financial results?

The deal is expected to be immediately accretive to TRNR's results upon closing.