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Virgin in funding talks with DIC

Dubai's $12bn wealth fund may take stake in Richard Branson's mobile phone, health club empire.

Virgin Group has held informal talks with Dubai International Capital (DIC) about securing investment backing from the $12 billion sovereign wealth fund, the UK's Times reported on Wednesday, without citing sources.

Possible financial support for Virgin could come from a sale of a stake in Virgin Active, which runs health clubs, or a mobile phone joint venture in the Middle East, the newspaper said.

A group of Virgin executives is understood to have visited Dubai recently to meet DIC officials to discuss potential deals, the newspaper said. Jehad Saleh, a spokeswoman for DIC, owned by the ruler of Dubai, could not immediately be reached for comment.

Virgin Active, which bought gym company Holmes Place two years ago, has opened two gyms in Dubai and is planning several more in the emirate, The Times said.

Active also has plans to expand in countries such as Italy, Portugal and South Africa. Virgin could sell a stake in the Active division to DIC, The Times said.

Sir Richard Branson owns 75% of Virgin Active, with the remaining shares held by management and the private equity firms Bridgepoint Capital and Permira. Virgin Group is thought to value Active at more than $1 billion, The Times said.

Middle Eastern wealth funds could also be interested in Virgin's plans to establish its pay-as-you-go mobile phone model in the region, the newspaper reported. Virgin may be bidding for two spectrum licences in the Middle East, it said. (Reuters)

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