Goldman Sachs and VTB invest in Russian fitness chain
Earlier this week World Class, a network of upmarket Russian gyms, declared a change in its ownership structure. Goldman Sachs and VTB have jointly bought a 50% stake in this well-known fitness chain which has over 60 centres in 22 cities across Russia.
Goldman Sachs Special Situations Group (SSG) became a minority investor in World Class in 2006. It has increased its share-holding as part of a wider strategy by the company to invest in established platforms. SSG’s investments seek to profit from a growing Russian middle class, who are continuing to spend despite the economic slowdown. Indeed, this was the rationale behind my company, VIY Management, recently choosing to invest in one of the leading networks of medical clinics, Semeynyi Doktor. Thanks to the spending habits of the emerging middle class, diagnostic and treatment services are now an expanding and lucrative market in Russia.
Over the past decade, SSG has gained notoriety for its ‘bitesize’ private equity deals in Russia and the CIS. It is widely considered to have made more direct investments into Russia than any other foreign bank. Highly publicised investments from reputed organisations, such as Goldman Sachs, play a significant role in reshaping international opinion of Russia’s allegedly vulnerable “emerging market”.