Pure Gym close to shelving £1.5bn London float amid IPO market volatility

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Pure Gym, Britain’s biggest health and fitness club chain, is close to abandoning a £1.5bn stock market listing amid growing signs of jitters among investors.

Sky News has learnt that Pure Gym, which is majority-owned by the private equity firm Leonard Green & Partners, could decide as soon as this week to shelve its proposed initial public offering (IPO).

If confirmed, the move would underline the unease which has gripped the London IPO market in recent weeks.

People workout at the PureGym in Leeds, Yorkshire, as indoor gyms, swimming pools and sports facilities can reopen as part of the latest easing of coronavirus lockdown measures in England.
Pure Gym has bounced back after the shock of the pandemic when forced closures cost it losses of £0.5m a day

Marley, a manufacturer of roof tiles, postponed its £500m listing earlier this week, citing market volatility, while Fruugo, an online marketplace, said last week that it was “pausing” a float.

Pure Gym has not formally announced an IPO but said in August that it was considering one among options to raise capital.

It appointed Morgan Stanley and Barclays to spearhead the listing, with Berenberg, Jefferies and Royal Bank of Canada in supporting roles.

City sources said an IPO had emerged as the favoured option for the company, which trades from more than 500 sites across Europe, including more than 285 in the UK.

It was unclear whether Pure Gym would examine other capital-raising options if it does pull its listing, or when an IPO might be revived.

Investors say the company was likely to have sought to raise several hundred million pounds if the float had gone ahead.

City of London skyline
If confirmed the move would underline the unease which has gripped the London IPO market

The proceeds were to be used for accelerating new gym openings and paying down its large debt-pile.

The company is chaired by Tony Ball, the former BSkyB boss, and run by chief executive Humphrey Cobbold.

“The pandemic highlighted what critical community assets gyms are and we were delighted to welcome our members back when we reopened,” Mr Cobbold said in August.

He added that it was “natural” for the company to be looking to raise new funding.

Pure Gym has bounced back well from the initial shock of the pandemic, when the closure of its sites resulted in losses of £0.5m every day.

A Pure Gym spokesman declined to comment.

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