Duke Street drives fitness consolidation

The private equity firm has compounded its presence in the UK health and fitness sector with the secondary purchase of Invicta Leisure from Electra.

European private equity firm Duke Street Capital has furthered its participation in the UK health and fitness sector with the acquisition of sports club operator Invicta Leisure.

The UK business, which operates 15 sports and fitness clubs across the UK, is being acquired from RIT Capital Partners, Electra Investment Trust and management for a total consideration of £140m. Invicta founder Kevin McCollum and Esporta finance director Michael Ball will form the basis of the management team of the enlarged business, which will trade under the Esporta brand.

Duke Street acquired Esporta in July following protracted negotiations with the Esporta board. Esporta, which operates primarily in the UK but also owns clubs in Spain and Sweden, finally succumbed to a 87.5 pence per share offer, valuing the firm at £145m.

The enlarged Esporta Group comprises 18 racquets clubs and 42 health & fitness clubs, with a further 13 scheduled to open before the end of 2003.  The group had 260,000 members at 30 June 2002, making it the UK’s second largest premium health, fitness and racquet club operator.

Duke Street Capital managing director Peter Taylor said the acquisition underlined the firm’s commitment to the premium health and fitness market, adding that it would 'provide a strong platform from which to grow the business both organically and via acquisitions'.

The sale by Electra Partners comes as a result of its announcement in 1999 that it would gradually wind down the Electra Investment Trust as part of the firm’s defence against £1bn-plus hostile takeover bid from 3i.