William Blair Advises Snap Fitness

Tuesday, January 21, 2014

William Blair & Company acted as financial advisor to Snap Fitness, Inc., its controlling shareholder and CEO and founder, Peter Taunton, and its minority investment partner, Summit Partners, in connection with a sale of a controlling interest to TZP Group. The transaction was signed and closed on December 23, 2013. This represents William Blair’s 20th fitness and wellness transaction for an aggregate value of $5.4 billion.

Transaction Highlights

  • Deep Sector Knowledge: Snap Fitness and Summit Partners were attracted to William Blair’s extensive knowledge of the fitness and wellness sector as well as a deep understanding of specifics associated with franchise businesses. William Blair worked closely with the management team to identify growth initiatives and investment highlights that differentiate Snap Fitness in the industry. One example is its vertical integration model, which facilitates multiple growth opportunities. 
  • Significant Transaction Experience: The transaction team marketed Snap Fitness to a broad group of potential financial partners and a select set of potential strategic partners.  The marketing and positioning effort achieved a growth multiple outcome consistent with comparable growth-oriented fitness franchisors and led to a simultaneous sign and close less than five weeks after receiving revised indications. William Blair outlined a transaction structure and terms balancing the goals of both primary owners. The founder and CEO was able to maintain a significant minority position, including a put right negotiated by William Blair along with an attractive employment and compensation package.
  • Acquisition & Organic Growth: Snap Fitness generated exceptional organic growth since inception and is one of the fastest growing fitness franchisors. In the 12 months leading up to the recapitalization by TZP, Snap Fitness completed several transactions providing incremental platforms to enhance the company’s growth profile. The combination of these acquisitions along with Peter Taunton’s visionary leadership has enabled the company to pursue multiple growth opportunities.

About the Companies

Founded in 2003, Snap Fitness, Inc. is a global fitness club franchisor with approximately 2,000 clubs open or under development in 15 countries. Its location amenities include 24-hour access to cardio, strength equipment, and personal training as well as proprietary offerings that enable members to continue their fitness and health experience online.

Summit Partners is a growth equity firm that has raised nearly $15 billion in capital, and provides equity and credit for growth, recapitalizations, and management buyouts. Founded in 1984, Summit has invested in more than 380 companies in technology, healthcare and other growth sectors. These companies have completed more than 130 public offerings, and more than 135 have been acquired through strategic mergers and sales. Notable consumer companies financed by Summit Partners include AVAST, Belkin, Nomacorc, optionsXpress, Philz Coffee, Physicians Formula, The Mutual Fund Store, Tiny Prints and vente-privee.com. Summit maintains offices in North America and Europe, and invests in companies around the world.

TZP Group is a leading middle market private equity firm specializing in recapitalizations and buyouts focused on being a “partner of choice” for owners and management teams. The company manages more than $500 million in private equity capital.

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