Ardent Leisure acquires Seven Zest Clubs in WA

The Ardent Leisure Group (ALG) is to acquire a portfolio of seven fitness clubs in Perth from Zest Health Clubs.

The seven clubs include five purpose built facilities and two clubs with short-term leases.

The $4.2 million acquisition for ALG's Goodlife Health Club division provides, according to Group Chairman Neil Balnaves, "a platform for future growth of of the Goodlife brand in Western Australia and complements the existing Goodlife health club located at (the) Westfield Carousel shopping centre in Perth."

Group Chief Executive Greg Shaw added that "the Group will upgrade the portfolio with an initial investment of $1.2 million in the current financial year together with a further $900,000 investment in equipment upgrades in the year end(ing) June 2011."

Shaw added that the acquisition is an important strategic step for ALG to provide Goodlife Health Clubs with a strong position in the Western Australian market and enhance Goodlife's geographic diversification.

As Shaw explains, "the acquisition will strengthen our health club platform to enhance earnings growth during the forecast economic recovery.

"The Western Australian market is currently less competitive than the Eastern States and the acquisition will provide a cost effective entry point for us to add new centres in future years."

The acquisition will be funded by $1 million in cash with the balance to be paid in ALG stapled securities.

The acquisition will reduce Zest Health Clubs once national profile to just four clubs in Western Australia, ALG having previously acquired, when operating as the Macquarie Leisure Trust Group, other Zest Health Clubs in South Australia and Queensland.

Goodlife is also understood to be developing a new weight loss program for introduction in their clubs across Australia.