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SNEWS sources have said that Bally Total Fitness (NYSE: BFT) is preparing to sell another large chunk of receivables to an unidentified private equity firm, which could eliminate $600 million in debt. It has already sold a smaller chunk of receivables. More details are not yet available. In addition, Town Sports International — the third largest chain of fitness clubs — has also been up for sale for several months because sources tell us that TSI — which is a portfolio company of private equity firm Bruckmann, Rosser, Sherrill & Co. LLC — is highly leveraged and Bruckmann wants to get out. And, in yet another sale, Fitness First, the largest European chain of clubs based in London, has confirmed it has received some “expressions of interest” from private equity houses but no offer had been received.
SNEWS View: To have two — or parts of two — of the largest U.S. club chains up for grabs is an interesting scene. However, our sources tell us that the TSI sale will be a tough one to get done and the company may abandon the attempt.