Vora Fund Takes 16% Stake In Town Sports; Pushes Sale
Town Sports International (NASDAQ: CLUB) trended up slightly Thursday after a hedge fund disclosed a 16 percent stake and said it would push the company to explore alternatives including a possible sale.
Town Sports, which runs a string of exercise clubs, has seen its shares drop more than 30 percent in the past month on declining membership and lowered Street estimates.
The company "could attract a range of financial or strategic buyers" based on its real estate and strong brands, Parag Vora's Vora Capital Management said in a filing Thursday.
Vora, which invests in leisure companies, also called on Town Sport to spend $67.1 million on a special dividend or share buyback while cutting overhead and limiting capital spending.
The hedge fund assembled its stake between July 24 and August 13 at prices ranging from $4.04 a share to $6.56.
Town Sports traded recently at $4.33, up 1.1 percent.
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