Johannesburg – Sale of Brait SE’s Virgin Active fitness chain will be delayed as much as 18 months following closures of gyms to help contain the coronavirus.
During the lockdown that started in March, membership fees were frozen and it’s going to “take some time to get back to where it was,” said Peter Hayward-Butt, a partner at Ethos Private Equity, which became Brait’s manager on March 1.
The firm said in November that it would look to sell assets over the next three to five years as part of a sweeping overhaul.
“Covid put a spanner in the works,” said Hayward-Butt. Yet Brait is not in the rush to sell the gym chain, which accounts for almost half its value, as the recent divestment of its stake in Iceland Foods and DGB, a South African wine producer and exporter, have “established the base” and helped pay down debt, he said.
Virgin Active’s big-box format allows the chain adequate physical distancing as outlets have reopened, while smaller competitors are struggling to accommodate their members, said Hayward-Butt.
He added that negotiations with landlords on rentals have meant an improved cost base.