27th August 2021
Good morning The good news is that we have a three day weekend to look forward to and the weather looks pleasant (but no heatwave). The bad news is that it’s the last one before Christmas. Have a good one!
Pure Gym shapes up for public market
New Sports Direct boss £100m bonus target
Yesterday's market moves
FTSE 100 -0.4% 7,125 FTSE 250 -0.1% 23,952
UK markets dipped on a quiet news day. Investors are holding their breath as they wait for further clues about when the Federal Reserve will reduce its crisis-era economic stimulus.
LEISUREPure Gym shapes up for public market
What’s going on?Pure Gym, the UK’s biggest gym chain, is exploring a possible listing on the London stock market as performance bounces back post lockdown.
Why is this important?
The fitness industry has been heavily impacted from Covid restrictions, gyms have been closed or with limited capacity for a lot of the last 18 months. Pure Gym says that now all 506 sites across the UK, Denmark and Switzerland are up and running with minimal restrictions in place. Since reopening there’s been a strong rebound in the demand for membership with 220,000 people signing since March.Pure Gym said it now has around 1.6 million members, which is 94% of the level it was at in December 2019 and an increase from the 81% seen in March this year.This has helped the company turn around between the first three months of the year – when it was losing £500,000 a day– to a return to profitability between April and June.All this has led the company’s US private equity owners to hire investment bank advisers as it considers fundraising options to help fund the opening of new gyms and paying back some debt. That could include making a public market debut as soon as this year.TakeawayAfter a challenging period Pure Gym has made an impressive turnaround and it well placed to raise cash for expansion with a public listing.It’s not the first time that it has tried to become a public company. Back in 2016 it had to cancel its plans after the Brexit vote dampened investor appetite for new listings. This time round the market is more buoyant so the company should have more takers.
RETAILNew Sports Direct boss £100m bonus target
Earlier this month Fraser Group, owner of high street chains including Sports Direct and House of Frasers, announced that it’s preparing to transition the CEO role from Mike Ashley to Michael Murray. The plans raised eyebrows as 31 year-old Murray is engaged to Ashley’s daughter. Murray, a former club promoter, has worked in the group since 2016, first providing property consulting services that netted him £15m in fees.Now the details of Murray’s pay package has been revealed. If he’s able to double Fraser Group’s share price by 2025 he’ll be paid £100m in shares. That’s on top of his £1m salary. The share price is currently around 660p and has reached as high as 900p in 2014. Concerns over corporate governance and working conditions, as well as the impact of Covid on retailers, have since hit the share price.Shareholders will vote on Murray's pay package next month. He is due to take over as CEO in May 2022.
Stat of the day
To mark 10 years in his role, Apple CEO Tim Cook will collect around 5 million Apple shares worth $750 million
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