PureGym considers stock market float to fund expansion plans

Discount gym chain PureGym is reviving plans to float on the stock market after a strong reopening.

The company is in the early stages of weighing options to raise funds to invest in its growth plans, with an initial public offering (IPO) among its possible avenues.

PureGym told bondholders on Wednesday that it is working closely with Leonard Green & Partners, who co-own the business alongside its management team, to review strategic options.

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The potential listing comes after the group decided to pull plans for a UK listing in 2016 amid uncertain markets following the UK’s vote to leave the EU.

On Wednesday, PureGym said it is “well-positioned to take advantage of this post-pandemic recovery” and opportunities presented by a weakening of competition over the past 18 months.

Bosses at the gym group said they believe there will be significant opportunities to invest to “accelerate growth through opening many more new sites” as well as pumping funds into existing gyms.

PureGym said it is particularly keen to expand its gym estates in the UK and Switzerland.

As of June 30, the company had 506 gyms across its global business, with 502 of these open and the remaining sites closed due to non-Covid reasons, such as refurbishment.

It also told bondholders that customer numbers for June were “in line” with levels from the same month in 2019.

Coronavirus – Mon Aug 31, 2020
PureGym has said it plans to use funds to grow its estate in the UK (Jane Barlow/PA)

In the UK, like-for-like visits in June were at 91% of their levels from June 2019 amid continued capacity restrictions.

A spokeswoman for the company said: “The Covid-19 pandemic has heightened the importance that people place on their health and well-being and both member response to reopening and new joiner rates have demonstrated that underlying demand for gyms remains strong.

“Against this background, the group is considering raising capital to accelerate growth through expansion of the estate and to facilitate further investment in existing sites and in digital and technology assets.

“At this early stage, the PureGym Group is still considering its strategic options, potentially including an IPO.”

Listed rival The Gym Group raised more than £31 million earlier this month to fund expansion plans for 40 new sites.