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Amid uncertainty for the gym industry, Planet Fitness is doubling down.
The affordable gym chain is acquiring 114 locations from Sunshine Fitness, its first franchisee, for $800 million in cash and stock. Sunshine Fitness operates in the Southeastern U.S.
Planet Fitness will use a mix of cash on hand and new securitized notes issued from an existing financing facility to pay $425 million of the total bill.
- Planet Fitness said it ended 2021 with 15.2 million members, marking a 12-month increase of 1.7 million people. It had 2,254 gyms in its system.
- Despite this hefty transaction, Planet Fitness said it was “retaining its asset-light business model,” and will own around 10% of its system-wide store base once the deal closes.
State of the Gym
The gym industry has faced the twin challenges of the global pandemic and the rise of at-home fitness, but recent data suggests a recovery.
ClassPass showed a 329% increase in in-person fitness reservations from January to November 2021. Live-stream workouts had a corresponding fall of 58% over the same period, bottoming out at just 2% of ClassPass reservations, compared to 89% in April 2020.
Hybrid work models may be benefiting the gym industry: 70% of respondents in a ClassPass survey said they have gone to a gym or fitness studio on days they’re working from home.
Placer.ai found that weekly gym visits recovered to 2019 levels by the end of 2021, despite being around 30% below the 2019 benchmark in February 2021.
