Coolmore trio to sell fitness chain

A CHAIN of fitness centres owned by John Magnier, JP McManus and Dermot Desmond is expected to be put up for sale this week.

Next Generation Clubs is expected to send out an information memorandum to potential bidders in the coming days with a price tag of at least €300 million needed to clinch the deal.

The Irish trio, along with bloodstock millionaire Michael Tabor, own more than 60% of Next Generation Clubs, which operates 16 fitness centres across Britain.

It is believed that up to 30 potential bidders have expressed an interest in buying the company.

As previously revealed by the Irish Examiner, Next Generation appointed investment bank UBS to advise on its options. These included a major acquisition of rival or an outright sale of the business.

According to reports, Esporta, the privately-owned rival club chain, is considering teaming up the Robert Tchenguiz, the Iranian property billionaire, to mount a bid.

It has also been speculated that other potential buyers are the Virgin boss Richard Branson, Fitness First, Whitbread (the owner of gym outfit David Lloyd Leisure) and private equity groups Cinven and Blackstone.

A sale of Next Generation for €300 million would net the Irish investors around €180 million.

Next Generation was set up in 1996 by the former British tennis star David Lloyd and is run by his son Scott. Any new owner would be buying a profitable and growing business.

According to accounts filed at Companies House in London recently, Next Generation made pre-tax profits of €4.4m on turnover of just over €50m. It also owns all of its properties.

With the opening of new clubs and the takeover of London’s Harbour Club earlier in the year, profits are believed to have improved.

The Lloyd family has a 10 per cent stake in the company, while British brewer Scottish & Newcastle owns 15 per cent.

Former Wimbledon tennis champion Billie-Jean King is also a shareholder.

Denis Brosnan, the former boss of Kerry Group, and chairman of Next Generation also has a small stake.

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