Britain’s biggest gym operator has secured a £300 million equity investment from KKR to back its expansion plans following the shelving of a mooted initial public offering.
Pure Gym, which has more than 500 clubs in Europe, said the US private equity firm would become “a significant minority investor” in the business alongside management and Leonard Green & Partners, which retains majority ownership.
The group has £200 million of liquidity so the KKR investment gives it access to about £500 million of capital to deploy in opening new clubs and stepping up international expansion. It is understood the KKR investment implies an enterprise value above the mooted £1.5 billion IPO valuation.
Pure Gym, which was launched in 2008, has a total of 511 clubs with 1.6 million members. It has 291 clubs in the UK and just before the pandemic it acquired Fitness World, a Danish operator with a presence in Denmark, Switzerland and Poland, for £350 million. It operates 180 gyms under the Fitness World flag and 40 in Switzerland that are being rebranded as Pure Gym.
Pure Gym has reopened its whole estate after lockdown closures and opened 20 new sites in the first nine months of this year. In Saudi Arabia it has opened the first of many planned franchise sites while it will soon open three trial sites in the United States.
It never formally declared its intention to float, although in a bondholder update in July it confirmed it was “in the early stages of considering options for potentially raising equity, including in the public markets”.
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Pure Gym eyes expansion with £300m equity funds