The Viva Leisure Ltd (ASX: VVA) share price has rocketed today following its Pinnacle clubs acquisition, and membership update.
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Shares in the health club operator raced up 10.1% to an intraday high of $3.05 in mid-morning trade before retreating slightly to $3 at the time of writing.
Acquisition and membership update
The Viva Leisure share price is among the top performers on the ASX market today after the company reported two positive updates.
Firstly, the company advised it has completed the acquisition of 6 Pinnacle health clubs earlier than expected. With all conditions relating to the sale satisfactorily met, the formal takeover was brought forward from its original 10 March timeframe.
Viva Leisure said the early acquisition will enable it to focus on bringing the new clubs in line with its hub and spoke strategy. The company seeks to penetrate the Melbourne suburban-metro market with its latest offering. The group currently operates a total of 101 health clubs across Australia’s eastern seaboard.
In addition, Viva Leisure reported that its membership base has grown to 115,000 members in the past 3 months. The record milestone reflects the growing trend of people leading more active and healthy lifestyles. The company’s membership base stood at 96,404 members in the prior corresponding period.
Viva Leisure will release its half-year results for the 2021 financial year on 25 February.
What did management say?
Commenting on the early acquisition, Viva Leisure CEO and managing director Harry Konstantinou, said:
We are pleased to have completed the acquisition of the Pinnacle clubs, a high-quality and complementary business to the Viva Brands. The transaction will significantly expand our reach and penetration throughout the Melbourne suburban-metro market.
We look forward to welcoming our new team members, integrating the operations, and serving our new and expanded Victorian membership base.
About the Viva Leisure share price
The Viva Leisure share price is up 4% over the past 12 months. Its shares plunged in March last year to a low of 66 cents due to COVID-19 government restrictions. However, the company’s shares have since rebounded.
Based on the current share price, Viva Leisure commands a market capitalisation of roughly $248 million.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.