Total Fitness shapes up with NorthEdge deal

PRIVATE equity firm NorthEdge Capital has backed the management buyout of Total Fitness, the Cheshire-based health and fitness business.

Manchester-based NorthEdge is backing a team led by chief executive Richard Millman together with turnaround specialists Warwick Ley and Brian Davidson of RooGreen Ventures.

Alongside a partial realisation of their equity, they have reinvested in the business as part of the buyout.

The deal will see the existing management team receive significant new investment to support its growth plans, which will being with the re-opening of the Total Fitness club in Wrexham this month following a £1m refurbishment.

The Wilmslow company, which was previously majority owned by its lenders Co-op Bank and Barclays after a debt for equity swap, achieved sales of £29.6m in 2013.

Membership has grown 14% since January 2013 and the business is back in profit.

Ray Stenton, partner and head of new business, investment director Tom Rowley and investment executive Gavin Bell led the deal for NorthEdge.

Stenton, who will join the board as non-executive director, said: “Total Fitness is a great business with a fantastic brand.  It has an ambitious investment strategy in place and we look forward to working alongside the management team to bring this to fruition and deliver on its growth objectives.”

Millman said: “We are really excited, as a management team, to be working with NorthEdge as a new partner in the continuing success story that is Total Fitness Health Clubs.

“Ray and the wider team have taken the time to really understand our business and the management team and have gained a real understanding of the business’ fundamentals and the key drivers of our future growth.

“Total Fitness is in an extremely strong position, delivering an ambitious investment programme and continuing to see a rise in membership and growth in operating profit as a result. I look forward to working to realise our vision of being the dominant health club chain in the North of England.”

Deloitte corporate finance partner Andy Westbrook provided corporate finance advice to NorthEdge, while KPMG completed financial and tax due diligence.

Property due diligence was undertaken by Coffer Corporate Leisure. GunnerCooke provided legal advice to NorthEdge, while DWF acted for RooGreen Ventures and management.  Mazars and DLA Piper advised the vendors.

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