Town Sports International Holdings, Inc. Announces the Acquisition of Flywheel Sports, Inc.’s Studio Business
January 06 2020 - 5:49PM
Business Wire
SECURES $50 MILLION IN SECOND LIEN LOAN IN
CONJUNCTION WITH PROPOSED TERM LOAN REFINANCING
Town Sports International Holdings, Inc. ("TSI" or the
"Company") (Nasdaq: CLUB), a diversified holding company and one of
the largest owners and operators of fitness clubs in the Northeast,
announced today that it entered into an agreement to
acquire the studio business of Flywheel Sports, Inc.
(“Flywheel”). The acquisition is expected to close in the first
quarter of 2020, upon satisfaction of customary closing conditions.
Established in 2010, Flywheel revolutionized competitive indoor
cycling. Flywheel has expanded to 29 locations across the United
States and multiple modalities and content, including its acclaimed
results-driven indoor cycling and off-bike precision training
workouts, including “FlyBarre” and “FlyFIT”.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20200106006004/en/
Flywheel Sports Studio
"Flywheel is an iconic name in the fitness industry and this
acquisition accelerates TSI’s strategic plan as we continue to
upgrade our club network and offer more value to our members. The
Flywheel acquisition fits perfectly into TSI’s strategy, as it
enables us to elevate our members’ fitness experience by offering a
luxury, boutique product while elevating their fitness routines,
along with the benefits of additional formats and locations. We
look forward to integrating and adopting Flywheel’s five star
standards and operational excellence within TSI as we raise the
operational and service standards at all TSI locations,”
said Patrick Walsh, TSI’s Chairman and CEO.
Walsh continued, “Through this acquisition, TSI plans to enhance
the gym experience, similar to the industry’s aggregators, and
offer more variety in content, locations and experience for a lower
cost.”
"Much has been written about the changes the fitness industry is
currently undergoing,” said Darren Richman, co-Founder of Kennedy
Lewis Investment Management, Flywheel’s current owner. “As in the
case of providers like Netflix who reimagined the importance of
content, and the need to provide customers with more for less, we
think that Patrick is following the exact same path at TSI in the
fitness space. He is facilitating the delivery of more fitness
modalities and content for value conscious consumers.”
TSI is expected to benefit from enhanced revenue potential as
the Company provides its over 600,000 members access to Flywheel’s
boutique facilities through packaged membership options. Flywheel’s
more than 300,000 members will also benefit from similar membership
packages as more than half of Flywheel locations are within two
miles of a TSI location.
As part of the acquisition, Kennedy Lewis has agreed to provide
seller financing of $25 million in the form of a second lien loan.
Kennedy Lewis has also agreed to assist with the refinancing of
TSI’s existing term loan, with a follow-on commitment of up to $25
million of additional second lien debt. The closing and follow on
commitment is conditioned upon TSI’s ability to reach acceptable
terms with its existing term loan lenders. Until the acquisition
closes, TSI and Flywheel have agreed to cross-market each other’s
products.
About Town Sports International Holdings, Inc.:
Town Sports International Holdings, Inc. is a diversified
holding company that owns subsidiaries engaged in a number of
business and investment activities. The Company's largest operating
subsidiaries have been involved in the fitness industry since 1973
and have grown to become one of the largest owners and operators of
fitness clubs in the Northeast. TSI's corporate structure provides
flexibility to make investments across a broad spectrum of
industries in order to create long-term value for shareholders.
Additional information can be found at
www.townsportsinternational.com.
About Flywheel Sports, Inc.:
Flywheel Sports, Inc., a leading boutique fitness brand,
provides results-driven classes at 29 studios. Established in 2010
in New York's Flatiron District, Flywheel offers a
high-intensity indoor cycling experience in a welcoming and
energetic atmosphere. A proprietary technology in metric-based
training removes guesswork from every move, enables riders to set
personal goals and track progress over time, in studio and at home.
Each class features a unique leaderboard that adds a fun,
competitive element to every ride. The off-bike precision training
workouts, designed to strengthen and sculpt the entire body, are
offered at 20 studios nationwide. A private, equity-backed company,
Flywheel employs more than 800 fitness professionals.
Additional information can be found
at www.flywheelsports.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200106006004/en/
212-246-6700 ext: 1260connect@tsiclubs.com
Town Sports (NASDAQ:CLUB)
Historical Stock Chart
From Aug 2024 to Sep 2024
Town Sports (NASDAQ:CLUB)
Historical Stock Chart
From Sep 2023 to Sep 2024