True Group teams up with China firm
The True Group fitness chain is joining forces with a Chinese investor to establish 20 new clubs in China over the next three years. Singapore-based True Group, one of Asia's leading fitness and wellness providers, will collaborate with Hong Kong-listed Tongfang Kontafarma in a US$36.7 million (S$51 million) venture.
The move involves Tongfang Kontafarma acquiring a 51 per cent stake in True Group's Singapore and China businesses and a 29 per cent holding in its Taiwan unit.
The partnership will then expand the business through corporate-owned and franchised clubs across first- and second-tier Chinese cities.
True Group founder and group chief executive Patrick Wee told The Straits Times that it has an annual revenue of about US$100 million and about 1,800 employees across all its 26 centres in Singapore, China and Taiwan.
He said the fitness market in China has doubled in size over the past two years.
"The growth areas for True Group in China is in the sports business. We are looking at bringing in sporting talents to train customers in sports academies, as well as managing sports centres and condominium-operated fitness centres. There are many low-hanging fruit for us.
"Also, as part of our partnership, we intend to expand clubs in industrial parks, many of which have high demand for fitness centres," he said.
Mr Wee revealed that, as part of the collaboration, True Group is paving the way for an initial public offering on the Hong Kong Stock Exchange.
True Group, which has 10 clubs and 47,000 members in Singapore, plans to open one to two more a year in the city fringe over the next few years.
Mr Wee noted that several local gyms had closed in recent years but said that is "a normal part of business".