Bally Manufacturing Corp. said Monday its health club chain filed for an initial public offering that is expected to raise between $75 million and $87 million.
The company`s Health & Tennis Corp. unit filed with the Securities and Exchange Commission to sell 5.8 million common shares–24 percent of the unit`s stock–at an expected $13 to $15 a share.
The estimated offering price of the common stock would give Health & Tennis a public market value of about $315 million to $360 million. Bally will still own 76 percent of the unit.
Bally also announced plans for an offering of $50 million of 20-year convertible subordinated debentures.
The Chicago-based company said proceeds from the offerings will be used to reduce its debt and to expand the health club chain, already the nation`s largest with more than 250 fitness centers.
Bally`s long-term debt soared early this month as a result of its $439 million purchase of the Golden Nugget Casino Hotel in Atlantic City, N.J.
In a story last week revealing the planned public offering, The Tribune quoted sources close to Bally as saying the company might consider reducing its stake to a minority position in Health & Tennis depending on how well the unit fares as a public company.
Sources also told The Tribune the company is considering an outright sale of its Six Flags theme amusement park chain.
Bally is the nation`s largest gaming company, with four casino-hotels and a gaming equipment and lottery supplies business.
