Goodlife Health Clubs has moved to extend its footprint in WA by buying all eight Fitness First clubs in Perth for $32.5 million.
The purchase makes Goodlife, which is owned by ASX-listed Ardent Leisure Group, the biggest non-franchised gym operator in Australia and boosts the number of its gyms to 15 in WA and 77 nationally.
Ardent, which also owns Dreamworld on the Gold Coast, will tap investors for $50 million in a capital raising to help pay for the purchase.
The buyout of Fitness First in WA will result in its gyms in Balga, Cannington, Floreat, Innaloo, Myaree, Brookfield Place (Perth CBD), Murray Street (Perth CBD) and Subiaco being rebadged as Goodlife Health Clubs.
Goodlife already has clubs in Bibra Lake, Carousel, Cottesloe, Joondalup, Kingsway, Mount Lawley and a new site under construction at Success.
Chief executive Greg Oliver said WA had emerged as a strong growth market for the company in recent years.
"We have continued to invest heavily in the west, refurbishing almost all of our clubs over the last three years, in addition to the current development of Success in the southern suburbs of Perth, which will create up to 50 new jobs," he said.
Goodlife said it also planned to invest an additional $5 million upgrading the newly acquired Fitness First clubs.
Mr Oliver said the WA deal reflected the global consumer trend towards healthy food, exercise and general well-being.
"An ever-growing number of people are actively seeking out more ways to live a healthier, happier life," he said.
The acquisition, which is expected to settle in a month, will lift Goodlife's membership base by about 21,500 to almost 215,000.
Ardent Leisure shares were in a trading halt this morning having last traded for $2.51.