By Abigail Summerville
Feb 2 ((Reuters)) - Investment firm Apollo is acquiring a minority stake in Canada’s largest fitness club operator The GoodLife Group, according to a statement viewed by Reuters.
The deal values the gym company at around C$2 billion ($1.46 billion), according to sources familiar with the matter.
Founded by David 'Patch' Patchell-Evans in 1979, the deal marks the first time the fitness chain has taken on outside equity capital. Patch, 72 years old, will remain chairman and an investor.
Apollo, which manages approximately $908 billion of assets, is making this investment through funds and affiliates associated with its hybrid strategies, according to the statement. The new capital will help GoodLife accelerate its long-term strategy and growth, and enhance its leadership position in the fitness market, it said.
London, Ontario-based GoodLife has over 400 clubs and around 1.5 million members across its banners GoodLife Fitness, Fit4Less, GYMVMT and Éconofitness. Bi-weekly membership fees range from C$7.99 to C$59.99, according to the company’s site. Patch came up with the idea for GoodLife while going through rehabilitation following a serious motorcycle accident.
"Given its deep experience with founder-led companies, we believe this investment from the Apollo Funds will enable us to build on nearly 50 years of success and accelerate our next chapter of growth," Patch said in the statement.
Investment firms like Apollo are typical acquirers of gym chains. Last year in the US, Leonard Green & Partners bought Crunch Fitness for an undisclosed amount and TSG Consumer Partners acquired EōS Fitness for a reported $1.5 billion. In boutique fitness, Princeton Equity Group acquired bootcamp concept Barry’s last year.
Apollo's hybrid strategy provides capital solutions to companies via debt and equity capital, according to its website.
Guggenheim Securities and McMillan advised GoodLife, while Jefferies, Paul, Weiss, Rifkind, Wharton & Garrison and Blake, Cassels & Graydon advised Apollo.
($1 = 1.3675 Canadian dollars)
(Reporting by Abigail Summerville in New York; editing by Echo Wang and Nick Zieminski in New York)
