This month saw the acquisition by Phoenix Equity Partners of a majority stake in budget gym operator, The Gym, from Bridges who retained a 25% stake in the business. Value for the deal is estimated at £90-100 million, with a new equity injection of £50 million. The Gym was established in 2007 as an incubated start up by Bridges, with founder John Treharne, a former England squash player and current CEO. Treharne had a background in the industry having opened his first health club chain, Dragons Health Clubs in 1991, which was floated in 1997 and sold on in 2000.
The Gym now has 37 gyms open across the UK and an ambitious expansion plan of 20 – 30 new gyms per year, with a strategy of focusing on sites near London Tube stations. The Phoenix transaction followed the acquisition earlier in the year of another low cost operator, Pure Gym, by CCMP Capital Advisors. Pure Gym was established in 2008 by leisure entrepreneur, Peter Roberts and currently has 49 gyms. Again, the group is expecting to expand rapidly with plans to have 150 clubs operating by 2016.
The expansion plans of both Pure Gym and The Gym reflect the success of low cost gyms in gaining market share within the UK fitness market in recent years. Budget gyms have grown in popularity since they first entered the market in 2008, and have been an important contributor to the overall growth in the industry, which has managed to grow throughout the recessionary period. In the year to March 2012, there was a 1.4% value increase in the fitness industry to £3.86 billion, according to The Leisure Database Company, with low cost operators contributing significantly as their model of low cost membership without fixed contracts has appealed to consumers. As the low cost end of the market starts to mature, we expect consolidation to take place, driving future M&A activity.
Cobell Ltd’s PWR+ brand of beetroot sports drinks was acquired by G’s Fresh, a supplier of vegetables and salads. The acquisition enables it to enter the sports drink sector and significant synergies are expected as it already supplies fresh and marinated beetroot.
The local craft cider manufacturer Cornish Orchards has been sold to the London based Fuller’s Brewery for an estimated £3.8m. The deal includes a £1.5m investment in the business whose products are to be rolled out around Fuller’s bars and hotels in London.
Barton Grange Garden Centre, in Wigan Road, Deane, has been bought by Middlesex-based Garden Centre Group. The Bolton centre’s sale is the first addition to The Garden Centre Group’s network since it came under the ownership of Terra Firma Private Equity.
The online retailer The Hut Group announced the acquisition of the York-based fashion retailer Coggles Ltd in a deal that includes all the intellectual property and brands. Since the company went into administration all shops had been closed and staff made redundant.
Sports Direct has decided to further expand in the outdoor wear market by acquiring Gelert from administration. Sports Direct later announced it had also acquired a majority stake in the outdoor sports chain Yeomans which previously owned Gelert.
The northern fashion retailer Ark Fashion was bought out of administration by JD Sports from Rett Retail. The move came as Ark offers young fashion products with a successful range of own branded items.
Slurp.co.uk which is registered as Ribica International, an innovative online wine and drinks retailer established in 2004, has been acquired by SH Jones, a family-owned wine merchant. This is the second purchase by SHJ of an online wine retailer this year following their acquisition of Hawkshead Wines in January.
Iglu.com, the online cruise and ski specialist, has acquired its competitor, Planet Cruise, making it the UK largest cruise retailer, with a combined turnover of £135m. The deal comes 12 months after it secured an investment from Growth Capital Partners valuing the company at £19m.
The Swedish coffee roaster Lofbergers Lila has acquired the UK-based Food Brands Group which own the Percol coffee brand. Owned by Electra Partners and management, Food Brands was a major supplier of Lofbergs. The acquisition is part of Lofberg’s strategy to expand in Europe. In 2011, Löfbergs bought the British company Red Cup that supplies coffee and coffee machines to offices and other large-scale households. The acquisition of Food Brands Group means that Löfbergs’s turnover in Britain will amount to approximately £ 12.5 million.
Food Brands Group has taken a substantial stake in the Caribbean restaurant group Turtle Bay, through a £6m investment. Turtle Bay was founded in 2011 with the opening of its first site in Milton Keynes. It also has restaurants in Bristol, Nottingham and Southampton. A further 20 outlets are planned over the next three to five years.
Phoenix Private Equity has acquired a majority stake in the low cost gym operator The Gym Group from Bridges Ventures, valuing the company at around £90m. The deal will allow The Gym to start an expansion scheme, with a plan to open up to 30 new gyms per year.
After having doubled the number of cinemas in the last three years, Vue Entertainment has been acquired by OMERS (Ontario Municipal Employees Retirement System) and Alberta Investment Management, two Canadian pension funds for £935m. There have been rumours that the acquisition of Odeon and UCI Cinemas Group might be next step in their consolidation strategy.