CPPIB-Backed Gym Chain Set to Raise at Least $445 Million in IPO

A Brazilian gym chain that counts Singapore’s sovereign wealth fund and Canada’s largest pension fund among its backers is set to raise at least 2.3 billion reais ($445 million) in an initial public offering, according to people familiar with the matter.

Smartfit is poised to sell 100 million shares at 23.00 reais apiece, slightly above the midpoint of the indicative range of between 20.00 to 25.00 reais, the people said, asking not to be named as the information isn’t public yet.

Smartfit declined to comment, citing its quiet period.

If over-allotments are fully sold, the total raised could reach about 3.1 billion reais, according to calculations based on the prospectus. Current holders GIC, Canada Pension Plan Investment Board and Brazilian asset management company Dynamo, all of which already had stakes in the firm, agreed to buy shares at the offering under some conditions.

Smartfit Escola de Ginastica e Danca SA, as the firm is formally known, operates 928 gyms across 13 Latin American countries including Mexico, Colombia, Chile and Peru. It ended the first quarter with about 2.4 million active clients, down from 2.8 million before the pandemic hit the region.

Banks running the deal were Itau BBA, Morgan Stanley, BTG Pactual, Santander Brasil and Banco ABC, and shares are expected to start trading on Wednesday under the ticker SMFT3.

Brazilian share offerings have totaled 91.6 billion reais year to date, up 83% from the same period in 2020, as locals continue to shift away from fixed-income investments toward higher-yielding products, according to data compiled by Bloomberg.

©2021 Bloomberg L.P.

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