About $900 million was raised by Life Time Fitness Inc. when it sold 29 real estate assets to raise funds for a buyout spearheaded by its founder. The aim of this exercise is to take it private again. The company presently has 114 fitness centers. The deal was inclusive of its facilities in Twin Cities, one in Eden Prairie and St. Louis Park. The company has obtained longer term leased from all owners of the 29 buildings and it continues to administer as they were before.
A few transactions took place on June 10, which incidentally was the same day Life Time concluded the buyout amounting to $4 billion headed by Bahram Akradi, the Chief Executive and Founder of the company. Three investment firms were involved in the effort: LNK Partners, TPG and Leonard Green & Partners. The company was also delisted from the NYSE that day.
Life Time, in its filing with the federal securities regulators, has publicized its plan to use the proceeds from real estate transactions. This money will go to fund a component of buyout and repay the previous debt. Expenses and fees associated with transaction are also to be paid from the proceeds. The company also expects to raise almost $2 billion in credit and loans. As per records obtained from Hennepin County, Life Time sold off its clubs at Interstate 494 and Hwy.62 for a sum of $23.2 million.
The buyer was Gramercy Property Trust, who paid about $300.5 million for space measuring approximately 1.3 million square feet. Two undisclosed buyers snapped up the real estate assets associated with the remaining 19 properties. However, as per records obtained from Hennepin County, San Diego based Terraza 17 LLC purchased St. Louis Park for $38.7 million. These transactions have the support of shareholders of the Life Time Company. This enabled the company to acquire increased value.
Life Time announced on August 2014 of its intention to forage an option, which would have separated Life Time into two distinct companies: a property company managing the real assets of both companies and the other an operating company administering the 114 fitness centers. The final call was brought into doable fruition by March when it was decided that the company would be taken into private hands through the involvement of three equity groups. Akradi would continue to administer the company as he was doing before.