December 14, 2021
Global investment firm KKR to become significant minority investor
14 December 2021, London – PureGym, a leading European gym operator, and KKR, a leading global investment firm, today announce that KKR will make a £300m equity investment in PureGym to support and fund PureGym’s ambitious expansion plans. KKR will become a significant minority investor in the business alongside management and Leonard Green & Partners (LGP), who retain a majority ownership position.
The PureGym Group reported strong Q3 results to bond investors in November with revenue ahead of the equivalent period in 2019 and profits bouncing back robustly from the challenges of the pandemic. The PureGym brand is now fully established in 40 sites in Switzerland, in Saudi Arabia where the first of many planned franchise sites are already open and trading, and will soon be in the US in three trial sites.
PureGym believes that the conditions are now right for significant further development of the business. Combined with existing resources and credit lines, the group will have access to approaching £500m of capital after the completion of this investment from KKR, with this capital enabling continued growth through the opening of more sites both in its current markets, as well as to sustain continued international expansion over the coming years.
PureGym will also deploy significant capital to strengthen the existing gym network, and maintain and enhance its already market-leading technology platform. This will continue a trend of tech and digital investment that recently saw the PureGym in-house developed app win the prize for UK Health & Fitness App of the year. PureGym has always applied technology innovatively and intends to remain at the vanguard of the world’s technology enabled gym and fitness operators.
Humphrey Cobbold, Chief Executive Officer of PureGym, said: “We are simply delighted to welcome today an investment firm of KKR’s stature – a firm I have known and respected for many years – as our new strategic partner. To have investors of the calibre of KKR and LGP supporting our business is a testament to the extraordinary efforts of every single colleague across our enterprise. It is also an endorsement of our overall strategy which is to become one of the leading players in the rapidly developing world market for gyms, fitness and activity.
At PureGym we are driven by a clear sense of mission and purpose – “Inspiring a Healthier World” – to make activity more affordable and more accessible to millions of people. We have a clear and deliverable growth strategy to ensure we deliver on this mission. We aim to expand further and consolidate our leadership positions in the UK, Switzerland and Denmark. Beyond Europe we have established a ground-breaking franchise partnership in the Middle East, exciting early-stage discussions with potential franchise partners in Asia, three trial sites preparing for launch in the US, and an exciting digital fitness development plan. With health and wellbeing rising to the top of the global agenda we now have the capital, the capabilities, the technology and the management team to become a global fitness and activity operator.”
Blaine MacDougald, Partner and Co-Head of KKR’s Strategic Investments Group, commented: “We have followed PureGym closely over the last few years as it emerged as an outstanding performer in its sector, with an experienced management team well-positioned to take advantage of the global opportunity in health and well-being. This investment provides PureGym with flexible capital to support its growth and international expansion plans and we will draw on the full range of KKR’s global platform and operational resources to help them drive further success for the business.”
Kris Galashan, Partner at LGP, said: “Today’s capital raising represents a significant development in the company’s journey. We are delighted to be working alongside KKR, one of the world’s leading investment firms, and look forward to working with them and the management team to secure further growth and success.”
KKR’s diversified and multi-asset investment platform provides KKR with the flexibility to support ambitious companies with a suite of comprehensive, bespoke capital solutions, further enhanced by its global experience and operational capabilities. KKR has been investing across strategies in the UK since the London office opened in 1998, with a long track record of helping leading UK-based businesses grow and internationalise. KKR has invested in businesses including ERM, Citation, Viridor, John Laing, Trainline, The Hut Group, Darktrace, among others, and has a strong global focus on consumer industries, with investments in Europe including Upfield, Roompot, Wella, Alliance Boots, SMCP, among others.
Closing of the investment remains subject to the satisfaction of customary conditions.
Enquiries
Media enquiries:
Sanctuary Counsel – Public Relations Adviser to PureGym
Robert Morgan / Rachel Miller / Katie O’Brien
+44 (0) 208 194 3189
press@puregym.com
Finsbury Glover Hering – Public Relations Adviser to KKR
+44 20 7251 3801
Alastair Elwen / Sophia Johnston
KKR-LON@fgh.com
About PureGym
PureGym is a leading European gym operator, with approximately 1.6 million members across 511 clubs in the UK and Europe under the Fitness World brand in Denmark and PureGym in Switzerland. PureGym was launched in the UK in 2009, where it pioneered the model for affordable, flexible, high-quality fitness clubs and is now the market leader. In the UK, members pay monthly and have no contractual commitment. Many of its gyms are open 24/7 and offer a full range of top of the line equipment, including cardiovascular equipment, fixed resistance and free weights. The group is majority owned by Leonard Green & Partners, L.P.
As at 30 September 2021, PureGym has 291 sites in the UK, 180 Fitness World clubs in Denmark and 40 Basefit clubs in Switzerland.
For more information about PureGym’s TrainSafe protocols see https://www.puregym.com/landing/trainsafe/
About KKR
KKR is a leading global investment firm that offers alternative asset management and capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life, and reinsurance products under the management of The Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com and on Twitter @KKR_Co.
About LGP
Leonard Green & Partners, L.P. (“LGP”) is a leading private equity investment firm founded in 1989 and based in Los Angeles with over $50 billion of assets under management. The firm partners with experienced management teams and often with founders to invest in market-leading companies. Since inception, LGP has invested in over 100 companies in the form of traditional buyouts, going-private transactions, recapitalizations, growth equity, and selective public equity and debt positions. The firm primarily focuses on companies providing services, including consumer, healthcare, and business services, as well as retail, distribution and industrials. For more information, please visit www.leonardgreen.com.
Forward-looking statements
This announcement may include forward-looking statements. All statements other than statements of historical facts included in this announcement, including those regarding PureGym’s financial position, business and acquisition strategy, plans and objectives of management for future operations are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of PureGym, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding PureGym’s present and future business strategies and the environment in which PureGym will operate in the future. Many factors could cause PureGym’s actual results, performance or achievements to differ materially from those in the forward-looking statements. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements. These forward-looking statements speak only as of the date of this announcement. PureGym expressly disclaims any obligations or undertaking, except as required by applicable law and applicable regulations to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in PureGym’s expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.
