With a public stamp of approval from Oprah Winfrey, Weight Watchers may see a huge turn around in business profits.
On Monday, the billionaire media mogul and the dieting company announced that Winfrey was buying a 10% stake in the company, leading to a more than 85% increase in the company’s stock numbers. According to a Securities and Exchange Commission filing, the 61-year-old bought her shares at $6.79 a piece for a total investment of $43.2 million. Currently, shares in the company have increased to more than $13.
Winfrey admits her decision to invest in Weight Watchers comes after having her own personal experience of success with the company.
“Weight Watchers has given me the tools to begin to make the lasting shift that I, and so many of us who are struggling with weight, have longed for,” said Winfrey. “I believe in the program so much I decided to invest in the company and partner in its evolution.”
In addition to joining the company as a board member, Winfrey will also serve as an adviser to the company while candidly sharing her experiences and perspective about the program.
“We believe that her remarkable ability to connect and inspire people to realize their full potential is uniquely complimentary to our powerful community, extraordinary coaches, and proven approach,” said Weight Watchers CEO Jim Chambers.
In recent years, the diet company’s business has taken a big slump in profit, which in part can be due to more people relying on technology to help them monitor their diet plans rather than Weight Watchers group meetings. In 2014, about 800,000 people attended Weight Watchers meetings, which was a decrease from the 1.3 million people in 2011. In the first half of this year, sales of the company were down 22% and profits nearly 50% according to CNN Money.
Under current agreement terms, Winfrey can buy an additional 5% of the company for the original investment price of $6.97 per share, but won’t have the right to sell any of her stocks until after two years.