Bulgaria's Next Level Fitness, which is part of the Multisport group and one of the largest fitness club owners in the country, has acquired its competitor Flais. The deal creates a new market leader and is the first major acquisition in the sector, which has so far grown mainly organically.
The deal
The buyer declined to comment on the details of the deal but according to information on the website of its parent company, Poland's Benefit Systems, Next Level Fitness has acquired 100% of the shares in seven companies related to the Flais fitness club network in Sofia: Fitness Flais Corporation, Power Ronic, Happy Group 1, Fitness Flais Group, Fitness Flais Pro, Flais Fit and Fit Energy. Their total revenue in 2022 came in at 7 million levs (about 3.5 million euro) but the figures for last year are likely higher.
The seven companies operate 11 fitness clubs under the name of Flais and 1 fitness club is under construction, Benefit Systems said. The buyer has also acquired selected assets belonging to 6 fitness clubs (including 2 fitness clubs under construction), as well as the Flais trademark. The total valuation of the transaction is around 15 million euro. The previous owners of Flais, Valeri Dushkov and Doychin Dochev, will keep some of their venues and run them under a new brand.
The buyer
The Polish group entered the Bulgarian market in 2015, when it established its local subsidiary Benefit Systems Bulgaria. It gained momentum and became known for its Multisport cards, which are also available in Poland, the Czech Republic, Slovakia and Croatia.
The company's business model is well-known: on the one hand, it signs contracts with employers through which the cards are purchased; on the other, it negotiates with sports venues the prices for visitors using the Multisport card, which are typically lower than direct visit prices without the card.
Less known is the other line of its business: fitness centers. The model comes from Poland, where - through Fit Invest - the company acquires equity in existing fitness centers, invests in its own gyms, and operates them.
The process of building a network of fitness centers in Sofia began in 2017 and the company now has 15 venues under the Next Level brand, with one more in the pipeline. Bulgaria's Next Level Fitness is majority owned by Benefit Systems International and Fit Invest International holds a minority interest.
The number of active Multisport cards has reached 140,000 and has remained at that level for a couple of years. That is probably the reason for the deal, as expanding the fitness club network is the only way for the company to grow, a market source commented for the Capital Weekly.
Other investments
Other companies in the sector are also expanding. The current market leader, Pulse, which has 21 locations, has recently announced a large-scale project in Sofia worth an estimated 14 million levs. The company plans to build the largest club in its chain-a five-story building with a total area of 6,500 sq. m featuring a large pool, a spa center with relaxation areas and a parking lot for more than 400 vehicles. The gym will offer a CrossRX hall, a multifunctional area with equipment, a strength zone for muscle mass and strength development, as well as rooms for group training and a cardio workout area. The new complex is expected to open in 2025.
Smaller players are also growing their networks. Earlier this summer Nord Sport acquired the Orange sports center in Paradise Mall, bringing its facilities to five. Nord Sport began its business in 2016 and is peripherally connected with Nord Holding, which operates in the scrap and recycling business. The Orange club has a swimming pool, a gym, rooms for group workouts, squash courts and a spa center. The deal was closed for Sport Invest Sofia, the company running the center. The price was not disclosed but judging by a registered pledge, it is likely in the range of 1 million levs.
Bulgaria's Next Level Fitness, which is part of the Multisport group and one of the largest fitness club owners in the country, has acquired its competitor Flais. The deal creates a new market leader and is the first major acquisition in the sector, which has so far grown mainly organically.
