Peloton Interactive is reportedly planning to sell around 20% of its entire stake in an attempt to turn around its struggling finances. Sources familiar with the matter said the exercise equipment and media company is now actively looking for a buyer.

Sources said the company's goal is to find a big-name corporate or private equity firm that can help legitimize the business with its investment. Peloton is reportedly in talks with several interested parties, but negotiations are still in their early stages. The names of the companies that have allegedly expressed interest in buying the 20% stake were not disclosed.

The New York-based Peloton has declined to comment on the proposed sale, which was first reported by the Wall Street Journal.

During the Covid-19 lockdowns, consumers who were kept at home hurried to acquire the company's bikes and join up exercise courses. However, demand has slowed in recent months, and management has attempted to revitalize the company.

Peloton CEO John Foley resigned in February after the company decided to lay off more than 2,800 workers. After riding high on pandemic sales and then plummeting back to Earth in the following months, the company was in a state of chaos. Add in the major product recall in 2021, and the company was inevitably going to have to make some changes.

Despite the appointment of former Spotify CFO Barry McCarthy, the company was still far from out of the woods. Getting a large new investor might help calm investor anxieties, especially if it's a large company like Inc., which was previously rumored to be interested in buying Peloton outright. Last year, software developer Box Inc. made a similar approach when it received a $500 million investment from KKR & Co.

Peloton's stock fell even further on Thursday as a result of the news of its planned stake sale. The stock, which had already lost approximately 80% of its value in the previous year, dropped as much as 7% in late trading. Peloton is expected to release its first-quarter earnings report next week, May 10.  

Talks about possibly selling the entire company have been circling around for months. Before Foley had exited the company, Blackwells Capital's Jason Aintabi had called on Peloton to explore a sale. However, McCarthy recently clarified that a complete sale of a company was not part of its plans. Since he took over, McCarthy has made significant changes, including dropping the prices of the company's exercise equipment to increase recurring revenue from its subscription services.