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Fitness First gyms in new hands

AAP logoAAP 30/09/2016 Peter Trute

The new private equity owners of Fitness First gyms will use their latest acquisition to build a nationwide presence in the health and fitness industry.

Quadrant Private Equity will add Fitness First's 65 clubs to a stable of that includes 76 Goodlife gyms, acquired from Ardent Leisure in August, and 250-plus Jetts 24-hour gyms bought earlier in September.

Quadrant executive chairman Chris Hadley said Fitness First's strong NSW presence tied in well with Goodlife's locations in other states.

"These two businesses come together in a national sense, so that we now have a completely national footprint," he said.

While Fitness First and Goodlife are full service gyms, the lower cost Jetts chain gives Quadrant's operations a presence across the market.

Mr Hadley said the suite of gyms now covers 650,000 members nationally, and allows the company to discuss offers with large corporations for deal packages, while the Jetts chain is also expanding into south east Asia.

Quadrant will retain the three brands as separate operations, although Mr Hadley said some changes would include longer operating hours for Fitness First.

The private equity player, which bought Fitness First from another private equity firm, Oaktree Capital Management, will look at a float of the gym business in the future.

Mr Hadley said the gym industry is growing, with 3.5 million people belonging to gyms in Australia, and membership growing at five per cent each year.

"The earnings will grow. We could float it in three or four years," Mr Hadley said.

"The brands will resonate with retail investors and I think institutional investors will appreciate the defensive nature of the income stream."

Quadrant is also looking at the health insurance industry and is considering discussions with government on broader health initiatives.

"Sixty per cent of the population is overweight," Mr Hadley said.

"Part of the government's agenda is to get people fit and keep them healthy.

"It must be a conversation to be had with the government, about how the fitness and gym industry plays its part in that."

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