Life Time Group Holdings Goes Public at $18 Per Share
Chanhassen-based Life Time Group Holdings Inc., a fitness and lifestyle chain, became the seventh Minnesota company to go public this year. Life Time went public today issuing 39 million shares at $18 per share. That translates into gross proceeds of $702 million before deducting commissions and other costs related to the offering.
A late September filing from the company outlined a plan to issue 46.2 million shares somewhere in the range of $18 to $21 per share. That number of shares at $21 per share would have raised gross proceeds of $970.2 million. Life Time issued fewer shares at the low end of its prospective price range.
In midday trading, Life Time’s stock was down slightly trading at $17.40 per share, a 3.3 percent decline.
The pandemic pummeled the company’s finances in 2020 as fitness clubs everywhere were shut down. Its revenue was cut in half to $948.4 million and it saw a net loss of $360.2 million for the year. In other words, the company lost nearly $1 million per day last year.
Before the pandemic, the company posted $1.85 billion of revenue for 2019, an 8.6 percent increase compared to 2018.
Life Time founder and CEO Bahram Akradi appeared on a brief CNBC interview on Thursday morning.
“We’re in a great position to grow substantially over the next decade,” said Akradi during the CNBC interview. He said that money raised through the IPO would help pay down debt and fuel the company’s growth.
Akradi bristles at referring to Life Time clubs as “gyms” or “fitness centers.” Instead, he calls them “athletic resorts,” a reflection of the company’s evolution into a lifestyle brand that is also looking to offer coworking and housing.
Life Time just opened a new location of Life Time Work, its coworking business, in downtown Minneapolis. At 54,000 square feet it is now the company’s largest coworking operation.
Minnesota’s flurry of IPO activity mirrors the national frenzy for public offerings this year, driven by massive amounts of money flowing into Wall Street.
By midyear, the state had already seen six IPOs so far in 2021:
- Sun Country Airlines Holdings Inc., IPO on March 17
- SkyWater Technology Inc., IPO on April 21
- Agiliti Inc., IPO on April 23
- Bright Health Group Inc., IPO on June 24
- Miromatrix Medical Inc., IPO on June 24
- CVRx Inc., IPO on June 30
There are more IPOs likely yet to come. Minneapolis-based Sezzle Inc., which is already public in Australia, has floated plans for a U.S. IPO.