A South African sale would be a loss to London, as the brand has a strong presence in the UK.
The group traditionally had more sites in the UK than in South Africa, but over the past year the situation has reversed – the number in the UK has fallen to 101, compared to 114 in South Africa.
Sources with knowledge of the firm believe it could get a higher price in Johannesburg, as South African investors have fewer chances than those in London to invest in well-known brands.
“It is an international company, but its relative size in the South African market and investors’ knowledge and appetite for the firm dwarfs every other consideration,” said the source. While London’s markets are full of major firms, South African investors “are not spoiled for choice, so they will go for that stock with more appetite than investors in the UK.”
Virgin Active has worked with financial advisers STJ since 2013, and Sky News reported the firm is holding a beauty parade to choose bankers to manage the sale.
The gym is 51 per cent owned by CVC Capital Markets, with Virgin Group owning 45 per cent. Virgin Active has more sites across Europe, as well as a handful in Asia-Pacific.
In December the group appointed Simon Susman, a veteran of South African business, as chief executive.
Virgin Active, CVC and STJ declined to comment.