Sir Richard Branson’s Virgin Active has signed an agreement to acquire a majority stake in the 47-club strong UK business of Holmes Place, to create a combined group with a value of £650m (US$1.24bn).
Bridgepoint and Permira, the private equity owners of Holmes Place that backed the £210m buyout and delisting of the company in May 2003, will reinvest by taking a minority stake in Virgin Active.
For the year ended December 31 2005, the enlarged group had 165 clubs in the UK, Italy, Spain and South Africa and generated revenues of £265m and Ebitda of £57m.
Sir Richard Branson said: “I am delighted to confirm today that Virgin Active has completed its purchase of Holmes Place, meaning many thousands of new members will experience fitness the Virgin Active way”.
Virgin Active was advised by New Boathouse Capital, Close Brothers and Allen & Overy. Bridgepoint and Permira were advised by SJ Berwin, and KPMG advised all parties. UBS and Rand Merchant Bank will provide the European and South African financing facilities respectively.