The upscale Spectrum Athletic Clubs is selling its Texas locations and returning its focus to Southern California, where it plans to add to its dozen gyms.
The El Segundo company said it agreed to sell its 11 San Antonio area locations to Gold's Gym International Inc. in Irving, Texas, but was still working out final details Friday. It would not disclose the sale price but said it expected to close the deal by the end of the month.
Bud Rockhill, Spectrum's president, said Friday that the San Antonio market was becoming saturated and that the potential for growth there was limited. In Southern California, he said, Spectrum has about 50,000 members at its 12 locations.
"This transaction has only a positive impact on our clubs in California," he said.
Over the next two to three months, Rockhill said, the company will consider plans to upgrade some of its existing gyms and to acquire others. He said the company caters to professionals and their families, charging dues of $70 to $80 a month.
Spectrum's sale is the fourth major deal in the industry in less than a year. The biggest splash came in early December when L.A. Fitness International in Irvine took over 171 Bally Total Fitness locations.
Spectrum's consolidation does not appear to be driven by shrinking profit margins, fitness club consultant John Atwood said. He called it a "win-win" deal for both companies.
"Both of them may enjoy an uptick in quality for different reasons," Atwood said. "Gold's is buying quality and will reinvent their position in that market, whereas Spectrum produces great quality wherever they go."
In its annual list of top 100 fitness clubs, trade magazine Club Industry said Spectrum took in $90 million in revenue in 2010. Gold's Gym did not disclose its revenue.
Spectrum is owned by private equity firm Brentwood Associates, which purchased the company in 1999.