Basic Fit jumps after deal to buy 47 clubs in Spain

Basic-Fit

22/12/2023 10:11

** Shares in Basic Fit  BFIT.AS  jump 6.7%, tracking their
best day in almost a year, after the Dutch discount gym chain on
Thursday said it would acquire 47 new clubs in Spain
    ** The company says it agreed to buy 47 clubs of the RSG
group, including 42 MCFit clubs and five Holmes Places clubs
with sauna and pool
    ** "The clubs are clearly a good fit to Basic-Fits' network
with for example an interesting stronghold in Barcelona," says
Degroof Petercam
    ** The deal is set to be completed in Q1 2024 and it will be
accretive to underlying earnings as of 2024; the company sees a
return on invested capital of at least 30% in 2026
    ** "Looking at the 30% ROIC projected, the total cost
(acquisition)+refurbishment should be close to 1.25m/club. We
estimate the takeover price at EUR 35m," KBC Securities says
    ** Degroof Petercam notes the takeover of a decent
competitor retreating from the market enforces Basic-Fit's
positioning
    ** "This is an important message for the market. Basic-Fit
is now the first market consolidator after a difficult FY22 for
many clubs," KBC says, adding more consolidation could follow
    ** The stock is up 16.8% YTD

 (Reporting Clement Martinot)
 ((Clement.martinot@tr.com))