VIRGIN ACTIVE TO ACQUIRE HOLMES PLACE BUSINESS

September 2006

reinvesting in Virgin Active by taking a minority stake. Completion is subject to approval by the Office of Fair Trading (OFT).

The transaction will create one of the UK’s most profitable health and fitness operations with a total of 165 health and fitness clubs in the UK, Italy, Spain and South Africa and over 900,000 members, of which 324,000 will be in the UK, all under the Virgin Active brand name. Virgin Active currently has 118 clubs in the UK, Italy, Spain and South Africa with over 710,000 members.

Commenting on this announcement, Matthew Bucknall, Managing Director, of Virgin Active, said:

“Virgin Active is a fantastic brand in the health club market representing quality, value for money and delivering great customer service. This acquisition will substantially enlarge Virgin Active’s operations and, in particular, strengthen its foothold in the UK market.

“Virgin Active, unlike other UK health and fitness operators, has demonstrated successful growth both in the UK and Europe. We are actively looking to expand the Group globally and already have a development pipeline of over 30 clubs in Continental Europe. With the acquisition of the Holmes Place clubs, we intend to build on their excellent fitness reputation. We will rebrand the clubs as Virgin Active over the next six months, once the transaction has been approved by the OFT, and will also be investing £20 million into the Holmes Place estate.”

Sir Richard Branson commented: “Since launching in the UK in 1999, Virgin Active has revolutionised the way our members view visiting the gym. Our blend of excellent classes and facilities go hand in hand with wide-ranging social activities and great discount schemes across other Virgin Group companies. Our health clubs and customer service are second to none in the industry. I am delighted to confirm today that Virgin Active has completed its purchase of Holmes Place meaning many thousands of new members will experience fitness the Virgin Active way!”

Bridgepoint and Permira backed the £210 million buyout and delisting of Holmes Place in May 2003. This transaction will result in both parties taking a minority stake in Virgin Active going forward. Bridgepoint and Permira will continue to be majority owners of the Holmes Place European businesses which are not being sold as part of this deal. These comprise 15 health and fitness clubs in Germany (7), Austria (4) and Switzerland (4).

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