Britain’s largest gym chain PureGym is considering its capital-raising options, including a potential market listing as it looks to meet the soaring demand for exercise as Covid curbs are eased.
Gyms were forced to close in the UK to stymie the spread of the virus. In response, people locked down in their houses took to exercising at home.
The removal of most restrictions in the UK had led to a rapid rebound in membership. All of the chain’s 506 gyms across the UK, Denmark and Switzerland are now operating with minimal restrictions, the company said in a statement to bondholders.
Paying members hit 1.6 million by August 15 – 94% of the level hit in December 2019 before the pandemic struck.
Chief executive Humphrey Cobbold said company was losing £500,000 a day during the “shockingly challenging first quarter” of 2021 when gyms were closed, the Financial Times reported. The company lost £92m in the first six months of 2021.
“We believe this is a propitious time to expand particularly in the UK and Switzerland,” Cobbold said, adding that health “has become an even bigger individual priority for consumers” since the pandemic.
“Clearly, we’re carrying a pretty debt-laden balance sheet at the moment. So I don’t think there’s any surprise that we’re considering capital raising options.”
PureGym is owned by Leonard Green & Partners, a Los Angeles-based private equity firm that bought it in 2017 in a deal that valued it at £600m.
The purchase came after PureGym cancelled earlier plans to float on the London Stock Exchange in the months after the Brexit vote in 2016, citing weak investor demand.
The company has appointed investment banks Morgan Stanley and Barclays as lead advisers, with Royal Bank of Canada, Jefferies and Berenberg lined up as bookrunners.
