NASHVILLE, TENN. — Tivity Health, Inc., a provider of fitness and health improvement programs, has entered into an agreement to acquire Nutrisystem, Inc., Fort Washington, Pa., for $1.3 billion. Nutrisystem manages weight management brands under its namesake and the South Beach Diet.
“The acquisition of Nutrisystem is an exciting and transformational event for Tivity Health as we expand our portfolio of healthy lifestyle brands,” said Donato Tramuto, chief executive officer of Tivity Health. “Many of the most common chronic conditions afflicting Americans today are associated with weight management, nutrition and physical fitness, and addressing both calories in and calories out is an important part of alleviating those conditions.
“Today, Tivity Health manages calories out with our SilverSneakers, Prime Fitness and flip50 programs; and Nutrisystem manages calories in with its weight loss solutions. We believe combining our two companies will create entirely new value propositions for our health plans, fitness partners, members and consumers.”
Under the terms of the agreement, Nutrisystem shareholders will receive $38.75 per share in cash and 0.2141 Tivity Health shares for each share of Nutrisystem common stock. The transaction values Nutrisystem at an enterprise value of $1.3 billion and an equity value of $1.4 billion, or approximately $47 per share. The implied stock consideration of $8.25 per Nutrisystem share is based on the volume-weighted average price of Tivity Health’s stock for the 10 days ended Dec. 3, 2018.
“This transaction will provide our shareholders with significant value and the opportunity to participate in the upside potential of the combined company through ownership of Tivity Health stock,” said Dawn Zier, president and c.e.o. of Nutrisystem. “Tivity Health and Nutrisystem share a common strategic vision, mission and culture, and we look forward to working with the Tivity Health team to take the combined organization to the next level.”
Upon the closing of the transaction, Tivity Health said it expects to maintain all existing Nutrisystem brands as well as its offices in Fort Washington. Ms. Zier will also become president and chief operating officer of the company and report to Mr. Tramuto.