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Sports Direct in talks to enter health club market

By Jak Phillips    14 May 2014
It has reportedly been a long-held goal of Sports Direct founder Mike Ashley to enter the health club market

Sports Direct International – the company founded by Newcastle United owner Mike Ashley – is considering a high-profile arrival in the health clubs sector with the acquisition of up to 33 LA fitness sites, according to reports.

Sports Direct confirmed to Reuters it was in talks over the move, which if successful, would see it follow retail rivals JD Sports into the gym market. The latter launched its first club at a former Fitness First site in Hull earlier this year.

Leases for the 33 sites were put up for sale by LA fitness in March as part of company voluntary arrangements (CVA) as part of a restructuring plan to reduce debt. It is not yet known how the sites would be branded or operated under any deal with Sports Direct.

Sources quoted in the national press claim Ashley has offered a parent company guarantee to LA fitness landlords in order to secure the sites, with a deal reportedly imminent.

Health Club Management understands that negotiations have been ongoing for some time and that a meeting took place yesterday among Sports Direct’s senior management.

The group recently recruited former DW Sports and Fitness CEO Winston Higham to become head of leisure at Sports Direct – a move widely viewed as a precursor to an assault on the health club market.

Sports Direct is also said to be attracted by the potential for synergy between gyms and the company’s existing operations. Sports Direct has over 600 sports stores in Europe, including 400 in the UK and also owns sports brands such as Dunlop, Everlast and Slazenger.

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