Impactive Capital bets on SLM and Basic Fit for long-term gains

Basic-Fit

22/10/2024 16:21

By Svea Herbst-Bayliss
       NEW YORK, Oct 22 (Reuters) - Impactive Capital doesn't
push companies to sell but wants them to do better on their own,
co-founder Lauren Taylor Wolfe said on Tuesday, citing student
loan company SLM  SLM.O  and gym chain Basic Fit  BFIT.AS  as
potential enduring success stories.
    "We take the long term view," Taylor Wolfe said, adding that
the firm, which calls itself an impact oriented activist fund,
wants companies to operate as their best selves and will work
with management on strategies to push up the stock price. "We
look for stable businesses where time is our friend."
    Taylor Wolfe spoke at the 13D Monitor Active-Passive
Investor Summit in New York.
    Basic Fit  BFIT.AS , a Dutch fitness club chain, offers a
bare bones workout space for members with weights and cardio
equipment but few employees and no pools, saunas or scented
towels. With over 1,600 locations now, Taylor Wolfe predicted
the company, headquartered in Hoofddorp, Netherlands, could have
3,000 locations by 2030. Staffing can be as small as having only
one employee on site during peak times. 
    The company reported a 13% gain in year-over-year membership
growth during the third quarter and a 17% gain in quarterly
revenue. It closed trading at 24 Euros a share on Monday and
could grow to 70 Euros a share in three years, Taylor Wolfe
said.
    Similarly, SLM, commonly known as Sallie Mae, could see its
stock price roughly double in three years, she said, noting that
the student loan company has done a good job buying back its
stock. The stock closed at $22.95 on Monday and she said it
could climb to $44 a share in three years.
    The company, which originates $7 billion in loans every
year, has captured 60% of the market, Taylor Wolfe said, adding
the market share is poised to grow as some competitors have
gotten out of the business.

 (Reporting by Svea Herbst-Bayliss
Editing by Shri Navaratnam)
 ((svea.herbst@thomsonreuters.com; +617 233 2138; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))