By Abigail Summerville
NEW YORK (Reuters) – Buyout agency TPG is weighing a possible sale of Crunch Health that would worth the health club chain at greater than $1.5 billion, together with debt, folks accustomed to the matter advised Reuters on Tuesday.
TPG, which acquired Crunch Health via its buyout arm that focuses on small and mid-sized acquisitions, is working with funding financial institution Jefferies on a sale course of that may very well be launched through the first half of subsequent 12 months, one of many sources stated, requesting anonymity because the matter is confidential.
TPG and Jefferies declined to remark. Crunch Health didn’t instantly reply to a request for remark.
Potential acquirers of Crunch Health embrace different personal fairness companies, the sources stated.
Based mostly on comparable transactions within the business, Crunch might command a valuation equal to greater than 15 instances its 12-month earnings earlier than curiosity, taxes, depreciation, and amortization of about $100 million, the sources stated.
Personal fairness companies have historically been prolific traders within the health and wellness business, as they’re drawn to the predictable money flows from subscription memberships and the chance to franchise areas.
In September, consumer-focused buyout agency L Catterton struck a deal to accumulate pilates chain Solidcore for between $600 million and $700 million, Reuters reported. In October, Josh Harris-backed funding agency 26North Companions agreed to purchase Onelife Health.
Based in 1989, Crunch Health began out with a basement health studio in New York’s Greenwich Village. The health club chain, which at present has round 2.5 million members worldwide, operates and franchises over 460 gyms in the US, Australia, Canada, Costa Rica, Portugal, Puerto Rico, and Spain.
In 2009, health business veterans Mark Mastrov and Jim Rowley, who led rival health club chain 24 Hour Health, teamed up with the personal fairness arm of Angelo Gordon to purchase Crunch Health out of chapter.
Crunch Health competes with different health club chains like Planet Health (NYSE:), which listed its shares via an preliminary public providing in 2015, and privately-held 24 Hour Health.
TPG Development, which acquired Crunch for an undisclosed quantity in 2019, has invested in quite a few firms throughout a number of industries, together with life sciences agency Precision Medication, cybersecurity agency Tanium, and ride-hailing app operator Uber (NYSE:).
