Topshop backer swoops for £600m PureGym

3 November 2017, 08:45

The buyout firm which jointly owns Topshop with Sir Philip Green is to take control of the UK's biggest gym chain in a £600m deal.

Sky News has learnt that Leonard Green & Partners has agreed a takeover of PureGym, with an announcement expected to be made later on Friday.

The deal will come as PureGym closes in on its millionth member, with that milestone expected to be hit early next year.

Leonard Green saw off competition to buy the company from rival bidders including the private equity unit of Goldman Sachs.

The sale of PureGym comes more than a year after the company abandoned a public listing, citing difficult market conditions in the wake of the EU referendum.

PureGym's main shareholder, CCMP Capital Advisors, has worked with Harris Williams and Jefferies on the sale, which City sources say is likely to complete by the end of the month.

CCMP, which has controlled PureGym since 2013, has overseen a period of strong growth at PureGym, which now trades from more than 189 clubs.

Its relentless expansion comes after a period of turbulence in the UK gyms sector, with operators such as Fitness First being forced into financial restructurings and takeovers.

The sale of PureGym would crystallise a windfall for Sir Chris Hoy, the six-time Olympics gold medallist, who has a small shareholding in the business.

Announcing its 2016 results in March, Humphrey Cobbold, PureGym's chief executive, said: "Almost a million people currently enjoy our affordable and flexible offer and we've introduced a variety of different membership options to suit a wide range of personal circumstances.

"No operator in the history of the gym and fitness sector in the UK has ever achieved this scale of membership. For 2017, expansion remains our priority with plans for 20 to 25 openings this year in total," he added.

"Despite our size, we retain a 'challenger brand' entrepreneurial spirit with a relentless focus on ensuring our offer appeals to 21st century consumers who want quality and value for money, the flexibility of a no contract offer and facilities they actually use," he added.

A PureGym spokesman declined to comment on the sale to Leonard Green.