NEW YORK -- The new owners of Equinox are arriving just in time for a national roll-out of Equinox health clubs and Equinox EnergyWear stores.
The 11-unit, family-owned chain was purchased Friday by two private equity firms -- North Castle Partners of Greenwich, Conn., and J.W. Childs Associates of Boston.
North Castle Partners invests in companies that provide products and services promoting healthy living such as Elizabeth Arden day spas, Saratoga bottled water and Grand Expectations luxury travel tours. North Castle Partners researched the health club market for two years, before buying Equinox, and occasionally partners with other firms for acquisitions, a company spokesman said.
The purchase price was not revealed, but industry sources valued the deal at substantially more than $100 million.
Equinox was built in less than a decade by five siblings who were born less than 30 months apart, and has grown to now employ 1,200 people.
In 1991, twins Lavinia and Vito Errico and their brother, Dan, started Equinox, aiming to attract urban professionals in their 20s and 30s to their hip health clubs. The following year, their younger sisters, Franny and Terri, who are identical twins, set up Equinox EnergyWear, the retail arm and private label business. To set themselves apart in the competitive Manhattan health club market, Equinox also offers day spas, juice bars and a battery of fitness classes in its locations.
As part of the deal, the two investment companies also purchased the Equinox EnergyWear retail operation.
William Howland, director of public relations and research for the International Health and Racquet Club Association, the Boston-based organization that represents 6,000 clubs worldwide, said the retail portion of the deal could prove to be "incredibly important." He pointed to Gold's Gym and Crunch as examples of other clubs that have used their activewear and other merchandise to increase brand awareness nationally.
"It's tremendously valuable to have people walking around with your logo on even if they're not gym members," Howland said.
The younger twins started their business by selling T-shirts from the juice bar at the Union Square location, Franny Errico said. At that time, the pair put cement in buckets and attached wrought-iron fixtures for displays."It was kind of funky and we were in the Flatiron district, so it worked," Franny Errico said.
Just as Equinox gyms were designed to be an alternative to sweaty gyms, its stores challenged traditional pro shops. Instead of offering strictly T-shirts and gym shorts, EnergyWear serves up a variety of labels, including several hard-to-find ones that double as activewear or streetwear.
Window displays are changed frequently and feature an array of colorful props and adhesive window graphics, since most stores have street-front windows.
Equinox EnergyWear will unveil its 10th store Friday, when a new club opens at 420 Lexington Avenue in New York, and the 11th unit is slated to bow next month at the Wall Street location, which is already open. Stores range in size from about 750 to 2,200 square feet.
Equinox's next club and store are scheduled to open in Greenwich Village next fall. There also are plans to open four more clubs and stores in major urban cities next year, according to Harvey Spevak, who continues as chief executive officer of Equinox. Clubs range in size from 20,000 to 40,000 square feet.
Spevak declined to name the sites being considered, other than to say, "We're not looking at Atlanta and Dallas."
The new owners also aim to maintain Equinox's signature look in its clubs and stores.
"We're not looking to change the product. We want to make it available to more people," Spevak said. "We are committed to Equinox's offerings and Equinox as a brand."
Having worked 12- to 14-hour days and many weekends over the past nine years, the Erricos -- especially those with young children -- were anxious to spend more time at home, Franny Errico said.
"After 10 years, they thought that it's time to get into something else and enjoy life," she said. "We've worked so hard for so long."
Under the new ownership, Franny Errico is the only family member who will continue to work full-time for the company, serving as the national buyer and spearheading the retail expansion. Terri, who goes by her married name Bialsky, will continue to work for Equinox EnergyWear part time. She had retail experience with Charles Jourdan and Kenneth Cole before branching out on her own.Like their siblings, the twins remain shareholders in the company. Their brother Dan will serve on the board of directors of the new company, which will continue to be called Equinox.
Franny Errico said she plans to be more involved with design and product development. Prior to starting Equinox EnergyWear, she worked as an intimate apparel and sportswear designer.
She attributed the winning retail strategy to spending a lot of time in the market and in the EnergyWear stores, offering labels exclusive to New York, maintaining reasonable prices and providing good quality. She also shops a variety of stores, including Barneys New York, Scoop, Intermix, Daffy's and Filene's Basement to keep track of what's selling and what's not.
"If you're dumping goods in New York City, how good can your business be?" Franny Errico said.
Enthusiastic about "taking the retail business to a different level," she said developing a loyal customer base is the best way to attract new customers through personal recommendations.
But there is one drawback to the new deal.
"We've spent so much time together. Now, we're going to have to make plans to see each other," she said. "There won't be any more of the running into someone and, 'Hey what are you guys doing for dinner?"
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