Weight Watchers losses spark hedge fund appetite

The recent underwhelming performance of Weight Watchers International, the listed global weight management and diet company, has seen the business become subject to takeover rumours by an as of yet unnamed activist hedge fund. Not surprisingly Weight Watcher’s share price yesterday increased off the back of this speculation, ending a downward trajectory that started in mid -November 2014 and with the exception of a slight rally in mid-April had continued to fall. Add in to the mix declining revenues year-on-year in 2013 and 2014 and it’s quite easy to see why the company might be the subject of a possible takeover bid.

Sources close to the company have confirmed that a hedge fund has recently acquired a significant portion of its outstanding loans and if the aim of this hedge fund was to arrest the continuing share price fall, then releasing information on this supposed takeover appears to have worked, albeit temporarily!

It remains to be seen whether outside of the world of hedge funds any other corporate has the appetite for this deal at this point in time.