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Jenny Craig Seeks Buyer

Sept. 12, 2018

Word has it that Jenny Craig is seeking a buyer for its business, according to The Wall Street Journal. Sources indicate the company has hired investment bankers to help advise it on the process.

The company has improved sales somewhat after being acquired in 2015 by private equity firm North Castle Partners. Expectations for this year are for Jenny Craig to generate $400 million in revenue and $35 million in EBITDA.

Marketdata Commentary

Since Jenny Craig went private, there is so little we know about its operations. It’s not surprising that North Castle would try to make a profit and sell the firm after a few good years of growth. However, we don’t know just how strong that growth was. Also, how effective the new owner, Monty Sharma, has been. There was a plan to integrate Jenny with the Curves fitness chain so that one could go to a center and not only meet with a counselor and pick up their food, but also exercise on site. The thing we don’t know is how many of the 600 centers has been transitioned to that model, and how customers have responded. Last we heard a year or so ago, only 50-75 centers were of the new model. Seems like our estimate of $400-450 million in annual sales in 2017 was right on target.

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