Sponsorship for the acquisition came from a private equity firm
BOCA RATON, Fla. - The newly formed Gold's Gym Investments has acquired Venice, Calif.-based Gold's Gym Enterprises and the G Group, the leading licensee of Gold's Gyms in the United States, with eight facilities in the greater Washington, D.C. area. Brockway Moran & Partners, a private equity firm, sponsored the transactions.
Kirk Galiani, John Galiani and Jeff Skeen, the management team behind the G Group, are now CEO, COO and CIO, respectively, of Gold's Gym Investments. Ed Connors and Tim Kimber - both of whom have been shareholders of Gold's Enterprises for the past 20 years - will retain senior management positions in the new organization.
As the majority stockholder in Gold's Gym Investments, Brockway Moran & Partners is prepared to back the company both monetarily and strategically. Investments in new advertising and marketing opportunities are part of the firm's plan for growing the Gold's business.
"We have strategic alliances with some major consumer product companies where we can do cross-promotions, where they can both promote the Gold's Gym brand, as well as their products," Peter C. Brockway, managing partner, told Club Industry. However, he wasn't at liberty to discuss examples.
Cross-promotions may provide new avenues to profit, but licensing will still represent a major source of growth for Gold's. Currently, the company counts 534 licensed facilities; Brockway hopes that number will reach 1,000 locations in three to five years.
Gold's expansion won't be limited to licensing. With the financial backing of Brockway Moran & Partners, Gold's Gym Investments will increase the number of corporate-owned Gold's clubs by purchasing existing licensee locations and constructing new facilities. The company already owns nine Gold's facilities (the eight clubs in the G Group and the original Gold's Gym in Venice, Calif.).
As far as licensees go, Brockway claimed that they shouldn't expect any major shakeups as a result of the acquistion. He spoke very highly of Gold's brand name and "rich heritage," and said there won't be any immediate changes to Gold's image or licensing structure. If anything, licensees can expect to benefit from the new owners' investments in growth strategies.