Actor Wahlberg enjoys 200% return on F45 Training IPO investment

F45 Training Holdings, the provider of group fitness classes backed by actor Mark Wahlberg, rose as much as 11 per cent then lost most of those gains in its trading debut after a $325 million initial public offering.

In a listing that was delayed by the coronavirus pandemic and then sidetracked by a blank-cheque merger deal that fell apart, F45 and an investor group that includes Mr Wahlberg sold more than 20 million shares for $16 each after marketing them for $15 to $17.

The shares, which opened on Thursday at $17, closed up 1.3 per cent from the offer price to $16.20, giving F45 a market value of $1.46 billion.

Mr Wahlberg invested in F45 through a private investment vehicle called MWIG, which sold almost 1.6 million shares in the IPO. Mr Wahlberg owns about 26 per cent of the membership interest in MWIG, according to F45’s filings.

F45, whose name is a mashup of “functional training” and the 45-minute duration of its classes, had filed confidentially for an IPO, Bloomberg reported in January 2020. Within a few months, the company that started in Australia and is now based in Austin, Texas, had put those plans on ice as the pandemic forced gyms and similar businesses to close.

In June 2020, F45 instead struck a deal to go public by merging with Crescent Acquisition, a special purpose acquisition company, or Spac. That agreement, which would have valued the combined company at $845m including debt, was terminated in October.

Adam Gilchrist, F45’s chief executive, said that the “prolonged uncertainty around the pandemic” kept the combination from being completed.

For the first three months of the year, F45 had a net loss of $37m on revenue of $18m, compared with a loss of $733,000 on $25m revenue during the same period in 2020, according to its filings.

The offering was led by Goldman Sachs and JP Morgan. The shares are trading on the New York Stock Exchange under the symbol FXLV, which incorporates the Roman numeral for 45.