Planet Fitness bulks up with $800M franchise acquisition

Planet Health is buying its largest franchisee, including 114 areas.
AFP through Getty Pictures

Planet Health will purchase its largest franchisee, Sunshine Health, in an $800 million deal that can beef up the corporate’s presence within the Southeast.

The Hampton, NH-based firm stated the acquisition is approaching the heels of robust progress in 2021, by which it added 1.7 million new prospects for a complete of 15.2 million members.

Gyms have been initially hit arduous by the pandemic in 2020 when some 9,100 gyms – or 1 / 4 of the business — closed for good. However many have been additionally capable of pivot by providing on-line lessons and health instruction.

Final 12 months, gyms started to get well, although it stays to be seen how the Omicron COVID-19 variant impacts the height membership season at first of the 12 months when individuals make New 12 months’s resolutions to shed kilos.

“There may be super long-term untapped alternative for our model to get individuals off the sofa,” Chris Rondeau, chief govt of Planet Health stated in an announcement, “which is why, as a frontrunner within the health business, we're making this strategic funding for the longer term.”

The health club business took an enormous hit throughout the top of the pandemic when it misplaced 9,100 areas for good.

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Some gyms have been capable of pivot and provide on-line lessons and instruction.

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Sunshine Health opened its first location in Altamonte Springs, Fla in 2003 and has 114 areas in Florida, Alabama, Georgia, South Carolina and North Carolina immediately.

The acquisition shall be funded with a mix of money and inventory and is anticipated so as to add to Planet Health’ earnings, the corporate stated.

Planet Health will personal 10 p.c or 200 of its 2,254 shops companywide when the transaction is accomplished.

Planet Health stated it added 1.7 million new members in 2021.

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Planet Health will personal 200 of its 2,254 areas after the Sunshine Health deal is accomplished.

Toronto Star through Getty Pictures

Shane McGuiness, co-founder and CEO of Sunshine Health, who has been an proprietor and operator within the Planet Health system for practically 20 years, will oversee operations of the mixed company retailer portfolio.

San Francisco-based non-public fairness agency, TSG Client Companions, acquired a majority stake in Sunshine Health in 2017 after beforehand backing Planet Health. It started exiting Planet Health in 2015, when it grew to become a publicly held firm, however will turn out to be a shareholder once more with the Sunshine Health acquisition, the businesses stated.  

Shares of Planet Health have been up by practically 2 p.c to $91 on Tuesday.