Thu, 16 Apr 2015 | BUSINESS SALE
Virgin Active has completed its sale to the private-equity division of financial group, Brait.
Backed by billionaire South African Christo Weise, Brait is set to pay £682 million for an 80 per cent stake of Virgin Active. The Virgin Group will retain 20 per cent. When the firm's debt is included, the gym chain's total value from the sale figures is £1.3 billion.
The sale to a South African-backed buyer is an interesting one given the company's popularity in the country. Of its 1.3 million gym members around the world, some 720,000 are in South Africa thanks to the brand's popularity as a symbol of aspiration.
Richard Branson commented: “Virgin Active is a business that we are proud to have been associated with from the very beginning, over 15 years ago.
“While today’s transaction is testament to the huge amount the business has already achieved, we believe that its future is more exciting. We are delighted that we will continue to play a part in this.”
Virgin Group first sold a majority stake in its gym business back in 2002 to Bridgepoint but the firm bought it back three years later. Its remained the focus of investment when in 2011 a 51 per cent stake was sold to rival private-equity firm CVC. This latest sale will see CVC exit completely, while the Virgin Group's stake will drop from 46 per cent to 20 per cent.
The news comes after Virgin Active had been exploring an initial public offering in Johannesburg for this summer. However, IPO plans from Virgin Group's perspective have now clearly been scrapped, but Brait retains the option to explore this avenue in future should it wish.
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