Whitbread completes sale of David Lloyd
Whitbread has completed the sale of its David Lloyd Leisure (DLL) chain to London & Regional (L&R), the property development firm owned by the Livingstone brothers, for £925m.
The sale is a multiple of 13.4x ebitda of £68.8m for the year to 1 March 2007.
Whitbread had previously said it would initially use the proceeds from the sale to pay down debt, and invest in its remaining core businesses - Premier Travel Inn and Costa Coffee.
L&R, which was backed in the deal by Bank of Scotland Corporate, is believed to have beaten off competition from MidOcean Capital, the private equity group, and Simon Halabi, who recently acquired Esporta, for the chain.
It said it would combine the Next Generations clubs it acquired last year for around £200m with the 71 sites David Lloyd currently operates.
The combined business will own 80 clubs in the UK and Ireland plus a further nine in Belgium, Spain and the Netherlands.
One new club is scheduled to open during the year and a further six sites are in the development pipeline.
David Lloyd's son Scott, who runs Next Generation, will continue to manage the enlarged group, which will have a combined membership of more than 470,000 members, with Bob Ivell as chairman.
Scott Lloyd said: "We are pleased to have completed the acquisition of David Lloyd Leisure, creating the market leader in the health and fitness sector in the UK. We look forward to integrating the businesses and sharing best practice between the two organisations.
"DLL is such a powerful brand and one that I believe has great value across the broader leisure sector. By strengthening our European footprint, we are well positioned not only to deliver excellent customer service at an affordable price but to offer our members a richer lifestyle.
"We will continue to grow the group organically, as well as to increase our presence across the UK and Europe through strategic acquisitions that compliment the enlarged estate and in particular, which increase the breadth of health and fitness services we can offer our members and their families at both ends of the age-scale."
For the year to 1 March, DLL reported operating profit of £37.1m on turnover of £237.3m.
