Life Time hopes to raise nearly $ 1 billion with new IPO
Life Time Fitness hopes to raise nearly $ 1 billion through an initial public offering of shares that it would use to pay off long-term debt.
The Chanhassen-based health, fitness and wellness chain filed an initial registration statement for an IPO on September 13, but did not disclose how many shares it would offer nor a price range for these stocks.
In an amendment to that filing with the Securities and Exchange Commission on Wednesday, Life Time Fitness said it plans to sell 46.2 million shares for between $ 18 and $ 21. A high-end offering would be the largest IPO ever by a state-owned Minnesota company.
Life Time Fitness was founded in 1992 by Bahram Akradi. It was a publicly traded company from 2004 to 2015, when Akradi and several investment companies privatized the company again.
Akradi and these investors would take the company back to the public stock market with a successful bid. After the offer, the company would still be considered a “controlled company”, meaning that Akradi and these investors would still own the majority of the shares.
Life Time has 153 premium fitness centers in 29 states and Canada. In 2018, the business expanded into coworking spaces, with its last opening last week in downtown Minneapolis.
Since going private in 2015, the company has opened fitness centers and expanded its presence in Boston, Chicago, New York and other major markets, and added markets in California.
Life Time is also renting out properties in more of its locations than in the past and has increased its digital health offerings for its members.
But going private also increased the company’s debt. According to the registration statement, Life Time had approximately $ 2.4 billion in debt as of June 30, 2021. The company would repay approximately $ 735 million – more or less, depending on the final offer price.
If the IPO costs $ 21 a share, it will raise more money than Bloomington-based Bright Health during its scaled-down IPO, which ended on June 23.
Bright Health raised $ 924 million by selling 51.4 million shares at $ 18 a share. It was the largest amount raised in an IPO by a Minnesota company. However, if the shares had been listed in the proposed range of $ 20 to $ 23, the health insurance company would have raised more than $ 1 billion.
If successful, Life Time would be the sixth Minnesota company to go public this year, joining Bright Health, Agility Health Inc., Sun Country Airlines, SkyWater Technology Inc. and Miromatrix Medical Inc.
Favorable market conditions led to a wave of IPOs. According to Renaissance Capital, 310 companies have priced IPOs this year, up 111% from the same period last year.
It may be weeks before the offer goes to market, and the price and size of the offer will depend on market conditions.