SPORTS Direct’s billionaire owner Mike Ashley has set his sights on expanding into the health and leisure industry, with plans to buy 33 sites from LA Fitness.
The health club chain confirmed yesterday that it was in talks with the Newcastle United football club owner over the 33 sites, which had been put up for sale as part of a major restructuring by the group.
“We have had discussions and meetings with lots of interested parties of which Sports Direct are one,” an LA Fitness spokesperson said. The company has until September to find a buyer, under its restructuring deal.
According to sources, Ashley has long expressed an interest in breaking into the fitness industry, which would complement its sports retail business.
The clubs are spread out across the country in areas including Bury St Edmunds, Cheltenham, Guildford, Liverpool, Birmingham and Salisbury.
Ashley has been on the hunt for ways to diversify Sports Direct. Earlier this year, he bought took out an option to buy a 6.6 per cent stake in department store group Debenhams and snapped up a stake in House of Fraser.
LA Fitness, which was bought by private equity firm MidOcean Partners in 2005, put its clubs on the block in March after a company voluntary arrangement with its landlords to cut its £250m debt pile.
A part of the restructuring, the chain was taken over by its lenders, led by the Royal Bank of Scotland in a debt-for-equity swap that will help cut LA’s debt and also put a new loan facility in place.