Mindbody acquires ClassPass, merger gets $500 million investment

Investor info: Mindbody was taken private by Vista Equity Partners in 2019 for $1.9 billion. ClassPass raised nearly $600 million in VC funding, most recently at a $1 billion valuation in early 2020, from firms like Apax Digital, L Catterton and General Catalyst. New investor Sixth Street is leading a $500 million investment in the combined company.

Deal structure: No pricing terms of the all-stock deal were disclosed, but Axios has learned that Mindbody will hold between a 60%-70% in the combined business, with ClassPass valued "significantly" above that $1 billion mark.

The bottom line: "The acquisition comes ... as studios reopen with nearly 80% of consumers feeling that wellness is more important than ever. Additionally, several markets that have fully reopened are seeing bookings on the Mindbody platform rebounding to pre-COVID levels and ClassPass consumer usage is at 110%  percent of pre-COVID usage for subscribers who have gone back to class," Forbes writes.