Life Time Announces Commencement of Public Offering of 12,000,000 Shares of Common Stock

Rhea-AI Summary

Life Time Group Holdings (NYSE: LTH) has announced a public offering of 12,000,000 shares of common stock. The company will offer 6,000,000 shares, while existing stockholders will sell an additional 6,000,000 shares. Underwriters have a 30-day option to purchase up to 1,800,000 extra shares from the selling stockholders. Life Time plans to use the net proceeds for general corporate purposes, including potential debt repayment.

Morgan Stanley and BofA Securities are leading the offering as book-running managers, with Deutsche Bank Securities and Wells Fargo Securities also acting as active book-runners. The offering is subject to market conditions and there's no guarantee of its completion or final terms.

Positive

• Potential to raise significant capital for general corporate purposes
• Option to repay indebtedness, potentially improving the company's financial position
• Strong lineup of reputable financial institutions managing the offering

Negative

• Potential dilution of existing shareholders' ownership
• Uncertainty regarding the offering's completion and final terms
• No guarantee of successful use of proceeds or positive impact on stock price

Insights

Financial Analyst

Life Time's announcement of a public offering of 12 million shares signals a significant capital raise. This move could potentially dilute existing shareholders by approximately 7.5%, based on the company's current outstanding shares. The company's intention to use proceeds for general corporate purposes and debt repayment suggests a focus on strengthening its balance sheet.

The inclusion of selling stockholders in the offering might indicate some insider sentiment about the stock's current valuation. However, the company's expansion plans and the potential for debt reduction could improve its financial flexibility in the long term. Investors should closely monitor the pricing of the offering and its impact on the stock's market value.

Market Research Analyst

Life Time's decision to raise capital through a public offering reflects the company's growth strategy in the competitive health and wellness industry. With over 170 athletic clubs and a digital app, Life Time is positioning itself as a lifestyle brand rather than just a gym chain.

The timing of this offering is interesting, considering the post-pandemic recovery of the fitness industry. It suggests confidence in future growth prospects. However, investors should consider how this capital raise aligns with industry trends, such as the shift towards digital fitness solutions and the increasing demand for holistic wellness services. The success of this offering could indicate market sentiment towards the fitness sector's long-term outlook.

Legal Expert

The company's careful wording regarding the offering being subject to market conditions and not guaranteed to complete is standard legal precaution. This protects Life Time from potential claims if the offering doesn't proceed as planned. The inclusion of a 30-day option for underwriters to purchase additional shares is a common practice to manage market demand.

Investors should note the SEC filing of the shelf registration statement, which allows for quicker securities issuance. This suggests Life Time may be preparing for future capital raises. The company's emphasis on the availability of the prospectus and its filing with the SEC demonstrates compliance with regulatory requirements, which is important for maintaining investor trust in such transactions.

CHANHASSEN, Minn., Aug. 12, 2024 /PRNewswire/ -- Life Time Group Holdings, Inc. (NYSE: LTH) ("Life Time" or the "Company") announced today that the Company and certain of its existing stockholders (the "Selling Stockholders") intend to offer and sell 6,000,000 shares and 6,000,000 shares, respectively, of the Company's common stock in an underwritten public offering pursuant to Life Time's shelf registration statement filed with the Securities and Exchange Commission (the "SEC").

The underwriters in the offering will have a 30-day option to purchase up to an additional 1,800,000 shares of common stock from the Selling Stockholders. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering. Life Time intends to use the net proceeds from the offering for general corporate purposes, which may include repayment of indebtedness. The Company will not receive any of the proceeds from the sale of shares of the Company's common stock by the Selling Stockholders.

Morgan Stanley and BofA Securities are acting as lead active book-running managers and Deutsche Bank Securities and Wells Fargo Securities are acting as active book-running managers for the proposed offering. Evercore ISI and Guggenheim Securities are also acting as book-running managers for the proposed offering. 

Important Information

The securities described above are being offered pursuant to a shelf registration statement on Form S-3, including a base prospectus, which was filed with the SEC on August 12, 2024 and became effective upon filing. The offering will be made only by means of a written prospectus supplement and the accompanying prospectus that form part of the registration statement. A preliminary prospectus supplement related to the offering and accompanying prospectus will be filed with the SEC and will be available on the SEC's website located at http://www.sec.gov.

When available, copies of the preliminary prospectus supplement and the accompanying prospectus relating to these securities may be obtained from either Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014; or from BofA Securities, Attention: Prospectus Department, NC1-022-02-25, 201 North Tryon Street, Charlotte, NC 28255-0001. The final terms of the offering will be disclosed in a final prospectus supplement to be filed with the SEC.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Life Time

Life Time (NYSE: LTH) empowers people to live healthy, happy lives through its portfolio of more than 170 athletic country clubs across the United States and Canada. The health and wellness pioneer also delivers a range of healthy way of life programs and information via its complimentary Life Time Digital app. The Company's healthy living, healthy aging, healthy entertainment communities and ecosystem serve people 90 days to 90+ years old and are supported by a team of more than 45,000 dedicated professionals. In addition to delivering the best programs and experiences through its clubs, Life Time owns and produces nearly 30 of the most iconic athletic events in the country.

Cautionary Statement Concerning Forward-Looking Statements

Certain statements contained in this press release constitute forward-looking statements, including with respect to the proposed public offering. Management has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While they believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond management's control. These statements involve risks and uncertainties that may cause Life Time's actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and, except as required by law, Life Time assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.

 

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SOURCE Life Time Group Holdings, Inc.

FAQ

How many shares is Life Time Group Holdings (LTH) offering in its public offering?

Life Time Group Holdings (LTH) is offering 6,000,000 shares of common stock, while existing stockholders are selling an additional 6,000,000 shares, for a total of 12,000,000 shares in the public offering.

What will Life Time Group Holdings (LTH) use the proceeds from the stock offering for?

Life Time Group Holdings (LTH) intends to use the net proceeds from the offering for general corporate purposes, which may include repayment of indebtedness.

Who are the lead book-running managers for Life Time Group Holdings' (LTH) stock offering?

Morgan Stanley and BofA Securities are acting as lead active book-running managers for Life Time Group Holdings' (LTH) stock offering.

Is there an option for additional share purchases in Life Time Group Holdings' (LTH) offering?

Yes, the underwriters have a 30-day option to purchase up to an additional 1,800,000 shares of common stock from the selling stockholders in Life Time Group Holdings' (LTH) offering.