Photographer: Billy H.C. Kwok/Bloomberg

Gym of Choice for Hong Kong Financial Elite Is Seeking a Buyer

Updated on
  • Pure Group could be valued at up to $500 million in sale
  • Investors include Leonard Green, billionaire Fung brothers

Owners of Pure Group, the billionaire-backed gym chain catering to Hong Kong’s financial elite, are seeking a sale that could value the company at as much as $500 million, people with knowledge of the matter said.

Pure Group investors, including buyout firm Leonard Green & Partners and businessman Bruce Rockowitz, are working with an investment bank to find a buyer for a controlling stake in the Hong Kong-based company, according to the people. It has drawn interest from Chinese private equity firms, the people said, asking not to be identified as the information is private.

Many of Pure Group’s fitness centers occupy prime Hong Kong real estate like IFC Mall, a stone’s throw away from the local headquarters of UBS Group AG and the stock exchange. Earlier this year, it opened a 10,000-square-foot (930-square-meter) yoga facility in the upscale Pacific Place mall, just downstairs from the offices of Carlyle Group LP, in a spot where a Burberry Group Plc outlet used to stand.

Founded in 2002, the group operates Pure Yoga and Pure Fitness centers in Hong Kong, Shanghai, Singapore, Taipei and New York. It also operates the rooftop RED Bar + Restaurant, which offers views of Hong Kong’s Victoria Harbor, and sells its own brands of activewear and organic food. The company has more than 70,000 clients and employs 1,400 staff, its website shows.

“A buyer would care about the China expansion. The market is at a relatively early development stage -- people are trying to work out more and get a healthy lifestyle,” Jacqueline Ko, an analyst at Kim Eng Securities (HK) Ltd., said by phone Tuesday. “They can charge a premium for a famous Hong Kong brand.”

Market Growth

The number of sports clubs in China is expected to increase 16 percent to around 10,960 locations by 2020, up from about 9,440 at the end of last year, according to forecasts from consultancy Euromonitor International. Any deal will add to the $123.8 billion of consumer acquisitions in Asia this year, data compiled by Bloomberg show.

Rockowitz, the chief executive officer of Global Brands Group Holding Ltd. and husband to Chinese pop singer Coco Lee, owns around half of Pure Group, according to the people. He is expected to divest a significant portion of his holding in any sale, the people said. 

Fung Group, the private holding company of Hong Kong billionaire brothers Victor and William Fung, is also seeking to offload its stake of about 10 percent, said the people. Pure Group management may keep a minority interest in the company, according to two of the people. 

Hong Kong’s Pure Group isn’t related to the U.K.-based chain PureGym Group. No final decisions have been made, and there’s no certainty the deliberations will lead to a transaction, the people said. 

Representatives for Pure Group and Fung Group said they couldn’t immediately comment. A representative for Leonard Green didn’t respond to emailed queries, while Rockowitz didn’t respond to requests for comment.

— With assistance by Kiel Porter, and Sterling Wong

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