Virgin Active, the British gym chain, wants to hold an initial public offering (IPO) in Johannesburg by the end of June, according to two people with knowledge of the matter.
Virgin Active had appointed five banks, all of them with operations in South Africa, to help it manage the share sale, said one of the people, who asked not to be identified as the information was private.
Virgin Active has 270 clubs in eight countries including UK, Italy, Spain, Portugal, Australia and Namibia with more than 1.3 million members, according to its website. It has 109 outlets in South Africa and Namibia, second only to the UK, which has 113 clubs.
CVC Capital Partners, an international equity firm that manages capital on behalf of some 300 companies and governmental institutions, owns about 45.58 percent of Virgin Active shares.
The Virgin Group holds 42.5 percent and management about 11.92 percent.
Nick Fox, a spokesman for billionaire Richard Branson’s Virgin Group in London, declined to comment after receiving e-mailed questions.
The PR company for Virgin Active in South Africa, Instinctif Partners, said Virgin Active did not want to comment on the rumours going around about its listing. “The company will not give any comment at this stage,” said Nicholas Williams at Instinctif Partners.
Goldman Sachs, UBS, Standard Bank, Bank of America and Morgan Stanley, which has a joint venture with Rand Merchant Bank in Johannesburg, were the banks appointed by Virgin Active, one of the people said.
Spokesmen for the banks declined to comment.
The gym chain started meeting with bankers in Johannesburg in the second week of January in order to choose institutions to manage the IPO, according to three people with knowledge of the matter.
Virgin Active might be valued at £1.5 billion (R26.25bn), Sky News reported last week, without saying how it had arrived at the figure.
Virgin Active shares the same chairman with Woolworths, Simon Susman.
Susman joined the gym chain last December, succeeding Richard Baker.
According to the company’s consolidated financial statements for the year to December 2013 the group grew revenue by 5 percent to £653.1 million on a constant currency basis.
However, the group said it had made a loss after tax for the year of £101.1m.
Virgin Active had a net cash inflow of £8.6m from financing activities delivering total positive cash inflow of £22.6m for the year.
The total obligations under lease and hire purchase contracts were £45.8m, total bank loans were £328m and there was a cash balance of £89.7m at the end of the year.
Total group net bank debt was £238.3m at the end of December 2013.
South African operations grew by 9 percent on a like-for-like basis in the year ended December 2013. – Additional reporting by Nompumelelo Magwaza