U.S.-based investment firm Oaktree Capital Management LP and its partner are looking to sell their Asia wellness business, including the popular Fitness First clubs, in a deal that could raise as much as US$1 billion, people with knowledge of the matter said.
Oaktree Capital and Navis Capital Partners Ltd., an Asia-focused private-equity firm, combined their wellness businesses in the region in 2017 to create Evolution Wellness Holdings Pte. Ltd. A sale process will start soon to solicit interest for the business, the people said.
Evolution Wellness says its network of almost 170 health clubs—with 370,000 members including in Hong Kong, Singapore, Thailand, Malaysia and Indonesia—is one of the largest in Asia. Its brands include Fitness First and Celebrity Fitness, which was owned by Navis before the merger.
Demand for wellness services in Asia is being driven by rising middle-class incomes, especially in major cities where consumers have been increasingly willing to pay for gym memberships and yoga classes.
According to an October report by Global Wellness Institute, the industry grew 13% from 2015 to 2017, making it a $4.2 trillion market world-wide. Countries like China, Malaysia and Singapore were ranked among the top 20 wellness real-estate markets in 2017, the report showed.
In December 2017, Hong Kong-based gym chain Pure Group, which operates the Pure Yoga and Pure Fitness centers in locations such as New York and Singapore, received investments from Hong Kong private-equity firm FountainVest Partners and Canada’s Ontario Teachers’ Pension Plan. People familiar with that deal have said that Pure Group was valued at more than $400 million.
Oaktree Capital, based in Los Angeles, has $120 billion assets under management as of Dec. 31, 2018, while Kuala Lumpur-based Navis Capital manages $5 billion in public and private-equity funds.
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