Latest news
Esporta continues to spurn advances of private equity group Duke Street
Esporta has again urged shareholders to reject the £133m bid for the group by Duke Street Capital Leisure Investments'. The board believes that the 80p a share offer undervalues the club and is a 'nil premium offer'.
Duke Street's claims that Esporta has provided no evidence that it has a 'sustainable recovery strategy' has been countered by the club operator's A Clear Strategy for Sustainable Growth report.
While Duke Street questions whether Esporta can survive in an increasingly competitive market, Esporta points to its new management team and cost savings as evidence that the company can turn the corner.
The health club operator plans growth through converting 14,000sq ft of 'low utilisation' areas into gyms and changing rooms, thus creating greater capacity within its existing clubs - the equivalent of opening four new clubs - allowing 14,000 new peak time members.
'Shareholders will benefit from recent openings and the potential for expansion from the new model,' said Maurice Kelly, chief executive.
Esporta is also implementing a new model for future openings with lower operating expenses and has identified 60 potential new locations.
'Despite spending 100 per cent more on marketing and waiving joining fees,' said Nick Irens, Duke Street chair, 'Esporta has achieved only modest first quarter like for like sales growth.' Shareholders have until 12 July to accept the Duke Street offer.