Technogym Sells €111M Stake to Saudi Fund

Technogym’s share price is on the up again.

What’s happening: In a €111M deal, the Italian fitness equipment maker sold a 6% stake and 4.5% voting rights to Saudi’s NEOM Investment Fund (NIF).

NIF is the finance arm of NEOM, a futuristic mega-development in Saudi Arabia pitched as “the perfect place to live, work and play” for ~9M residents by 2045. Buoyed by the sale, Technogym shares climbed amidst a backdrop of steady growth – this year, revenue rose 13% to €565M through Q3 2023.

Saudi Ties

This isn’t the first time Technogym’s founder and CEO, Nerio Alessandri, has joined forces with Saudi Arabia. A $50M 2020 contract saw the manufacturer become Fitness Time’s exclusive supplier across its 150+ network – and a recommitment this September ensures all future openings depend on Technogym.

On top of that, Italy and Saudi signed MoUs to boost economic and trade in the countries, with digital technology, health and tourism among leading fields of interest.

Why it matters: Selling Technogym shares form part of Alessandri’s wealth diversification strategy. But despite releasing ~50M since 2017, his majority remains his largest and most beloved asset. Retaining control, he’s also hung onto 50.5% of Technogym’s voting rights.

Steering the company to its “wellness on the go” concept, connecting 50M users with personalised fitness no matter where they are, Alessandri envisions a future where Technogym is prescribed as medicine. Working alongside the $500B NEOM concept will serve to nudge Technogym closer to its futuristic health market.

Looking ahead: While Middle East, India and Africa (MEIA) revenue is among Technogym’s lowest, it’s making strides, rising 33% on last year. With Technogym’s primary segment Europe remaining solid, it will continue to seize deals that advance its global goals, especially preventative health opportunities.