Private-equity firm TPG is making a play in the workout space by acquiring Crunch Fitness.
The transaction announced on Monday includes Crunch’s company-owned “Signature” facilities, along with its global franchising business. Financial terms of the agreement were not disclosed.
The firm’s buyout of the popular gym chain comes as an increasing number of consumers are getting more fitness-conscious. According to the IHRSA, 20% of American adults have a fitness club membership, with the craze continuing to accelerate.
“Fitness is at an all-time high. We’ve got a fantastic management team, we’ve got a lot of franchise momentum, our Signature clubs are performing well,” Crunch CEO Jim Rowley told YFi PM.
TPG “saw an opportunity and they seized that opportunity,” he added.
Founded in 1989, Crunch currently owns, operates, and franchises more than 300 fitness centers. They service more than 1.3 million members across the U.S., Australia, Canada, and Spain.
Back in 2009, Rowley acquired Crunch with the private-equity help of Angelo Gordon, and began franchising the brand in 2010.
Rowley said that the company was now at an “inflection point” that, when combined with societal trends, made TPG’s buyout offer a matter of perfect timing. The industry is booming, and niche clubs are focused on boxing, yoga, and stretch opening up around the country.
“We’re seeing participation level at the highest level it’s ever been,” Rowley said.
Given high U.S. rates of obesity and heart disease rates, “sitting is the new smoking,” the executive told Yahoo Finance.
“When you’ve got a sedentary lifestyle, we know that it contributes to a lot of negative health factors, and people are realizing that more and more,” he added.
McKenzie DeGroot is a producer at Yahoo Finance. Follow her on Twitter: @degrootmckenzie