Peloton Interactive (PTON  ), an exercise equipment and media company, has recently announced that it plans to obtain the exercise equipment made by manufacturer Precor for a $420 million deal. Within a few hours of making the deal, fitness stock rose by about 8%.

There has been a particularly high demand for Peloton's exercise equipment lately, especially given the nature of the pandemic, thus placing tension on the supply chain, given that many consumers are now working from home and are looking for more exercise equipment.

As part of the deal that has been acquired with Precor, Peloton has decided to take some of Precor's factories in places such as Whitsett, North Carolina, and Woodinville, Washington. Peloton, however, has reported that it has been "under supply constraints for the foreseeable future," due to the pandemic related supply chain issues, according to a letter to shareholders written by Chief Executive John Foley.

But with its partnership with Precor, both of these companies plan to create monumental success together heading into the future. Peloton shares, for instance, have increased by 403% so far this year, thus making bringing the stock to a market valuation of $42.2. billion. In terms of accomplishments, this particular deal should cause Peloton to "accelerate production and shorten lead times." Therefore, the sales and marketability will likely increase. It will also improve the amount of manufacturing capacity that is allotted.

As far as future growth in 2021 is concerned, Peloton can be expected to improve its supply chain as well as grow its subscriber base. This means that there may be an increased number of hardware products among other exercise items that can be utilized within the home. As far as subscribers are concerned, the growth of them is envisioned to exponentially increase with a goal of around 100 million. In this past year alone, there was a revenue growth of around 232%. Therefore, the deal made between Precor and Peloton is planned to be successful, as it is already proving to be such in present times.