Snap Fitness for sale | Riverside sells Hiway | Ares funds Pallas

One of the world’s largest gym operators is on the market – and is not overlooking potential interest from deep-pocketed Australian private equity.

Snap Fitness was founded by Peter Taunton in 2003. Its parent, Lift Brands, is run by London-based Australian businessman Ty Menzies.

Sources said Menzies was in town last week speaking to prospective buyers – private equity and strategic – in advance of a sale process being kicked off by advisory boutique Record Point this week.

According to information circulated to potential acquirers, Snap Fitness has 333 facilities in the Asia-Pacific region – largely Australia, but also New Zealand, Indonesia and Japan – which accounts for 46 per cent of the company’s revenue.

Snap Fitness has 547 sites in the United States and Canada – some 42 per cent of revenues – and 118 in Europe, which constitutes the remaining 12 per cent of revenues. More than 800,000 members attend its gyms, lured by the “24/7 access, affordable price points and convenient locations”, according to a teaser for the auction, which goes by the codename Project Viking.

The business, which operates as a franchisor and includes Fitness On Demand, a wellness streaming service, is headquartered in Minneapolis, Minnesota, but has regional head offices in London and Brisbane.

Although Record Point will no doubt target global sponsors, Snap Fitness is expected to attract the attention of local private equity groups already invested in the sector. Parties are signing non-disclosure agreements this week, sources said.

The biggest among the gym owners is Quadrant Private Equity, which has operated the sprawling Fitness and Lifestyle Group business since 2016, when it acquired Goodlife Health Clubs from Ardent Leisure. Fitness and Lifestyle Group’s best-known gym brands include Fitness First, Barry’s Bootcamps and Jetts Fitness.

Recent sales show businesses similar to Snap have traded at about 10 times earnings, with Britain’s largest operator, PureGym, buying up Denmark’s Fitness World for around $500 million in late 2019 – 9.2-times EBITDA – and Viva Leisure buying up the Plus Fitness brand of health clubs in August 2020 for about $20 million, or 11-times EBITDA.

Read the full story tomorrow and more on the Street Talk page.

Although Record Point will no doubt target global sponsors, Snap Fitness is expected to attract the attention of local PE groups already invested in the sector.

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