LA Fitness agrees to £90.3m takeover by private equity buyer

LA Fitness succumbed last night to a £90.3m takeover bid from Mid-Ocean Partners, a private equity group, ending a protracted takeover process for the UK's last quoted fitness club operator.

LA Fitness succumbed last night to a £90.3m takeover bid from Mid-Ocean Partners, a private equity group, ending a protracted takeover process for the UK's last quoted fitness club operator.

Fred Turok, the chief executive, is ploughing half of his £14m windfall from selling the group he founded nine years ago back into the private company. The move will allow him to share in any upside when the company is eventually sold or refloated.

The group announced that its independent directors had agreed at 6.30pm to back the 220p-a-share offer, two hours after the market closed.

Peter Jacobs, the chairman of LA Fitness, said the offer was "fair and reasonable" and "provides shareholders with the certainty of cash at a premium to the current share price against the backdrop of a challenging trading environment."

Shares in LA Fitness, which traded at 257.5p in January, rose 2p to 193.5p yesterday, still below the offer price.

Mr Turok, who had a 17 per cent stake in LA Fitness, said: "I believe this is a good deal for all parties. After five and a half years of running a listed company, I look forward to the next stage in the development of LA Fitness."

Mr Turok is investing £7.1m in return for an initial 18 per cent stake in the private company. That could rise depending on how well the group performs away from the stock market.

Richard Taylor, the finance director who co-founded the group with Mr Turok, is reinvesting £165,000 in the new company. He will get a 3 per cent stake. Other senior management will have the opportunity to invest £440,000 in the new company in return for an 8 per cent stake.

LA Fitness said it had received irrevocable undertakings for 30 per cent of the company's share capital. Mid-Ocean was formed in 2003 by senior managers of DB Capital Partners.