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Life Time Fitness Being Taken Private for $4 billion

Life Time Fitness Inc., a gym operator, said Leonard Green & Partners and TPG will be taking the firm private in a deal valued at $4 billion. Life Time’s fitness clubs have been facing increasing competition from sellers of gym equipment that can be used at home and niche workout companies. Life Time operated 114 gyms under its Life Time Fitness and Life Time Athletic brands in North America.

Hedge fund, Mercato Capital Management, has kept the company under pressure to explore a potential conversion of its property into a real estate investment trust, since August.

Life Time’s shares are risen 62% even-though the company posted lower than expected profit for the past three quarters. The cash offer of $72.10 per share is a 7.3% premium to Life Time’s closing price on Friday.

Marcato’s 8% stake is now valued at $225 million, thanks to the deal.