Viva Leisure launches $16 million equity raising to fund new acquisitions

Australian Stock Exchange listed fitness operator Viva Leisure has announced the launch of a fully underwritten $16 million equity raising to complete two acquisitions.

The fundraising is to support Viva Leisure’s binding agreements for two strategic acquisitions - the adding of eight health club locations in Western Australia and the expansion of the Club Lime brand in this market, complementing the group’s existing 14 Plus Fitness corporate locations in the state.

Commenting on the fundraising in a presentation to the Australian Stock Exchange (ASX), Viva Leisure Limited Chief Executive, Harry Konstantinou wrote “our journey has been one of growth, innovation, and unwavering commitment to delivering exceptional value to our members and stakeholders.

“This has seen the business grow in five short years since listing to be the second largest health club owner in the nation, and the second largest network of health clubs in the country.

“With guidance EBITDA for FY2024 forecast to reach over $35 million, the financial performance of the business has been resilient, growing an amazing 400% since IPO in June 2019.”

Explaining the Western Australian acquisitions, Konstantinou noted that they “bring us approximately 20,000 new members and are expected to generate $14.7 million in revenue and $3.9 million in EBITDA in FY24 (pre-synergies).

“These acquisitions mark a significant milestone, making Western Australia our sixth market for Club Lime in Australia. With these acquisitions, our corporate membership will surpass 215,000 members, and network membership will increase to over 385,000 members reinforcing our position as a leading fitness brand across the nation.”

He went on to state that the capital raising “will enable us to fund these strategic acquisitions and invest in rebranding and working capital” adding “moving forward, the company will continue to utilise its cash flow and existing debt facilities for regular business activities, including other acquisitions."

Viva Leisure’s shares were briefly placed in a trading halt at the company’s request pending the release of today’s announcement.

Image: Viva Leisure's equity raising will fund acquisitions and the expansion of the Club Lime brand in Western Australia.