PureGym Considers Reviving IPO Plans as U.K. Lockdowns Ease

David Hellier

14 Jul 2021, 10:15 PM IST

(Bloomberg) -- PureGym, the no-frills fitness-center chain, is considering reviving plans for an initial public offering.

The company is in the early stages of weighing raising equity in the public markets and is working with private investor and co-owner Leonard Green & Partners on its options, according to an update to bondholders on Wednesday.

A potential listing comes as gyms across the U.K. see a rebound in business with the ending of pandemic lockdowns. Total visits to PureGym’s fitness centers in the U.K., Denmark and Switzerland in June were up 14% from levels seen in December 2019, before the onset of the Covid-19 crisis, according to the bondholder presentation.

“Despite the extreme challenges the gyms and fitness sector has faced, the PureGym Group is well-positioned to take advantage of this post-pandemic recovery and the opportunities presented by competition having been weakened by the rigors of the last 18 months,” a spokesperson for PureGym said.

PureGym decided to pull plans for a U.K. listing in 2016 amid uncertain markets in the wake of the country’s vote to leave the European Union. The company is led by Chief Executive Officer Humphrey Cobbold, who was previously boss of the online cycling retailer Wiggle Ltd.

The company’s net debt stood at 778 million pounds ($1 billion) at the end of the first quarter, results for the period show, 33 million pounds more than the pre-pandemic total. Ratings agency Fitch Ratings Inc. wrote in a note Wednesday that an IPO could be credit positive for PureGym and “accelerate new gym openings ahead of our current forecast.”

PureGym raised 445 million euros ($525 million) through a bond sale in November, even as its facilities in the U.K. remained closed, benefiting from an upbeat credit market boosted by positive vaccine developments. Proceeds were used to repay a bridge facility that had been in place to fund its acquisition of Fitness World. It tapped the market again in March to raise 45 million euros for general corporate purposes.