VIRGIN Active is considering buying rival gyms after a private equity house took a majority stake in the business.
City A.M. understands that Virgin Active could make further deals while it integrates Esporta, the rival chain it took over earlier this year.
The health and fitness firm is also targeting organic growth after CVC Capital Partners took a 51 per cent stake over the weekend. Virgin has been left with a 49 per cent stake, excluding the impact of a management incentive scheme.
Virgin Active, which was valued at about £900m in the deal, has 254 clubs and 1.1m members across the UK, South Africa, Italy, Spain Portugal and Australia.
It wants to win more customers in South Africa, Italy and the Iberian countries but will also consider opportunities to acquire other businesses.
In April Virgin snapped up Esporta’s 55 gyms from French bank Société Générale for £77.6m, making it the UK’s biggest gym chain by members. The deal saw 159,000 Esporta members transfer to Virgin, taking it ahead of David Lloyd Leisure Operations. Fitness First is the biggest gym by number of chains.
Other private equity firms beyond CVC had looked at Virgin and this interest intensified after the deal with Esporta was carried out.
Virgin Active, which had been majority owned by Sir Richard Branson, has long faced rumours that it will float but the private equity deal is not thought likely to affect plans for an initial public offering when markets are more confident.
No-one from Virgin Active was available to comment yesterday.