Tivity Health Completes Divestiture of Nutrition Business
Company Focused on Core Healthcare Business, Strategic Growth Opportunities.
Nashville, TN/PRNewswire—Tivity Health (Nasdaq: TVTY) announced today that it has completed the divestiture of its Nutrition Business, which includes Nutrisystem® and South Beach Diet®, to Kainos Capital, a leading food and consumer-focused private equity firm, for a total gross purchase price of $575 million in cash. The Company used a significant majority of the divestiture net proceeds to pay down debt, which has materially de-levered its balance sheet and will provide significant additional financial flexibility to support the growth of its go-forward, focused healthcare business. The transaction is expected to result in a fourth quarter 2020 post-close net leverage ratio of no more than 2.8x.
“This transaction will enable Tivity Health to drive sustainable growth within our healthcare business, accelerating our SilverSneakers®, Prime® Fitness, WholeHealth Living® and Wisely Well™ brands with new digital engagement tools and data to become a more member-centric organization,” said Anthony Sanfilippo, Chairman of the Board of Directors, Tivity Health. “In addition to divesting the Nutrition division, we’ve realigned our organizational structure and resources to best deliver on our growth opportunities, and we expect to continue to achieve strong operational performance as a result of our disciplined approach. I am extremely proud of the progress we’ve made repositioning the business, accelerating the positive change since Richard Ashworth became CEO in June. Building on our solid foundation and with Richard’s capable and focused leadership, I am confident Tivity Health is on track to become the modern destination for healthy living.”
“The strategic changes underway at Tivity Health have unlocked a wide range of exciting opportunities to promote growth in our healthcare business and bring new and expanded capabilities to our members, customers and partners,” said Richard Ashworth, CEO, Tivity Health. “We have a strong, talented team in place, and have begun a search for a Chief Customer Experience and Innovation Officer, as well as a Chief Information Officer, to support our go-forward strategy. Tommy Lewis will remain as Chief Operating Officer, with a focus on supporting our health plans and fitness location partners in our core healthcare commercial operations. As President of the Nutrition Division, Tommy orchestrated an impressive turnaround, significantly improving the Division’s performance in just over ten months. We are grateful for his contributions and pleased that our healthcare business will continue to benefit from his expert guidance. I look forward to sharing more about our go-forward strategy on our fourth quarter and full year earnings call in February.”