May 1, 2008 12:00 PM
Snap Fitness CEO Says Company Not For Sale
Chanhassen, MN — Snap Fitness CEO and founder Peter Taunton denied a recent report stating that Snap Fitness is for sale. However, at least one industry observer maintains that the company is for sale.
In an interview with Club Industry's Fitness Business Pro, Taunton says that although private-equity firms solicit his 24-hour key-card club company on a weekly basis, Snap Fitness is not for sale.
“I have no desire to sell a majority share of our company,” Taunton says. “[I've] never been in dialogue with anyone. We're very well capitalized, and we're a very profitable company.”
Taunton added, however, that if he found the right strategic partner, he would entertain a sale.
“I've always left that door open,” he says. “If I didn't, it would be very irresponsible on my part as a founder and CEO. After all, I've got hundreds of franchisees that depend on me to make good decisions.”
A recent story in an industry publication stated that Snap Fitness sent a “teaser note” to potential buyers, saying the company has 508 open clubs and 1,230 sold locations. Taunton says Snap Fitness, founded in 2003, has about 700 clubs open and 1,460 locations sold. He did acknowledge that some of the figures in the story, including one that reported that company revenues were $19 million in 2007 and are projected to be $30 million this year, are “in line.”
One industry insider says that Taunton and his staff have been sending letters to investment companies with specific, detailed information about Snap Fitness.
“Snap has been shopping for money for about a month,” the insider says. “They may say that they're not for sale, but they sent out a letter which pretty much indicated that the company was for sale. They're looking for investors.”
According to the Snap Fitness franchise disclosure document, 182 of the 241 franchise units that were open at least six months as of Dec. 31, 2007, had at least 250 memberships, and 71 had at least 400 memberships.
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