Hong Kong | Finance elite’s gym of choice is said to near sale

Bruce Rockowitz

FountainVest Partners is in advanced talks to buy control of Pure Group in a deal valuing the billionaire-backed Hong Kong gym chain at more than USD400 million, people with knowledge of the matter said.

The Chinese private equity firm is holding late-stage negotiations with Pure Group owners including buyout firm Leonard Green & Partners and businessman Bruce Rockowitz, according to the people. Other potential buyers including Primavera Capital still remain around the process, the people said, asking not to be identified as the information is private.

Pure Group fitness centers cater to Hong Kong’s legions of well-heeled bankers and lawyers. They occupy prime real estate in spots like IFC Mall, a stone’s throw from the local headquarters of UBS Group AG and the stock exchange. Earlier this year, it opened a 930-square-meter yoga facility in the upscale Pacific Place mall, just downstairs from the offices of Carlyle Group LP, in a spot where a Burberry Group Plc outlet used to stand.

Founded in 2002, the group operates Pure Yoga and Pure Fitness centers in Hong Kong, Shanghai, Singapore, Taipei and New York. It also operates the rooftop RED Bar + Restaurant, which offers views of Hong Kong’s Victoria Harbour, and sells its own brands of activewear and organic food. The company has more than 70,000 clients and employs 1,400 staff, its website shows.

Rockowitz, the chief executive officer of Global Brands Group Holding Ltd. and husband to Chinese pop singer Coco Lee, owns around half of Pure Group, people familiar with the matter said in October. He is expected to divest a significant portion of his holding in any sale. Fung Group, the private holding company of Hong Kong billionaire brothers Victor and William Fung, was also seeking to offload its stake of about 10 percent, the people said at the time.

The number of sports clubs in China is expected to increase 16 percent to around 10,960 locations by 2020, up from about 9,440 at the end of last year, according to forecasts from consultancy Euromonitor International.

No final agreements have been reached, and negotiations could still fall apart, the people said.

Representatives for FountainVest and Fung Group declined to comment, while a spokeswoman for Pure Group said she couldn’t immediately comment. Rockowitz and Primavera founder Fred Hu didn’t immediately respond to requests for comment. Leonard Green didn’t answer a call to its office and an email seeking comment outside regular U.S. business hours.

FountainVest, led by former Goldman Sachs Group Inc. banker Frank Tang, has made a priority of deals for consumer and lifestyle companies. Last year, the fund invested in the Chinese joint venture of Hollywood superagency William Morris Endeavor. It has also owned a stake in IMAX China Holding Inc., which sells large-screen cinema technology in the world’s second-
largest economy. Jonathan Browning, Vinicy Chan, Bloomberg