3i pulls out of TrainStation

UK-based health club chain, TrainStation has been acquired by Crown Sports for GBP8.4 million providing an exit for venture capital house 3i, which originally owned a 45 per cent stake in the company. The purchase consideration of approximately GBP6.2 million will be satisfied by GBP5.063 million in cash, and the issue of 3,548,387 ordinary shares of five pence each in Crown Sports to the director vendors at 31 pence. In addition, Crown Sports will assume approximately GBP2.2 million of total net liabilities on completion. The management and 3i were advised by RSM Robson Rhodes.

3i originally supported Paul Bird and Steve Turnock, two experienced operators in the leisure sector, in 1997 to develop the TrainStation concept. Since 3i’s investment, the company has witnessed significant growth with three well-established health clubs located in Chester, Southport and Manchester with total membership of over 8,800.

“Having built our operations up to three clubs and 8,800 members, we are pleased to have the opportunity to consolidate our business into that of Crown Sports plc. This will enable our members to enjoy the benefits of the enlarged group and will also offer additional career opportunities for our management and staff,” said Paul Bird, chief executive of TrainStation.

Crown Sports currently runs 33 health clubs and eight golf clubs. The acquisition of TrainStation health clubs will further enhance shareholder earnings.

Will Clark, portfolio director of 3i’s Liverpool office, said: “Times have changed and we have seen the emergence of a few large national players and we along with management recognise the benefits to be gained by the company becoming part of a larger group.”