Diversified Health Makes Another Acquisition

Fort Lauderdale, FL — Despite a struggling economy that has forced some companies to shut down some of their clubs, Diversified Health and Fitness keeps expanding.

The Fort Lauderdale, FL-based company took on another distressed fitness club franchise with its recent acquisition of 1-2-3 Fit, a Denver-based coed circuit fitness club created by Quiznos founders Rick Schaden and Brooksy Smith.

In the asset purchase, Diversified Health acquired 21 of the 1-2-3 Fit franchise contracts. The purchase included franchise agreements, FDD registrations, area developer agreements, manuals, trade names and other intellectual property.

In March, Diversified Health purchased Butterfly Life, a chain of women-only clubs. Both 1-2-3 Fit and Butterfly Life were featured last year in a Club Industry's Fitness Business Pro cover story about struggling franchisors and franchisees who had fallen into severe debt. Former 1-2-3 Fit franchisees accused the company of lying about its initial franchise costs as well as the exclusivity of its equipment.

1-2-3 Fit opened in 2005 with the backing of industry veteran Ray Wilson, who sold his share of the company two years later.

“I have every confidence that Diversified will bring support and health club expertise to our family of 1-2-3 Fit franchisees,” Smith, 1-2-3 Fit's CEO, said in a company statement.

With the acquisition of 1-2-3 Fit, Diversified Health has 12 brands to its name and 249 clubs in its portfolio. Other brands include ShapeXpress, Liberty Fitness, Sedona and The Zoo.

“We are pleased to be taking in a strong chain developed by franchise industry experts,” Diversified CEO Roger Wittenberns said in a statement. “The 1-2-3 Fit acquisitions will add yet another dimension to our portfolio and increase our share of the coed fitness market.”

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