The share price of Ardent Leisure Group (ASX: AAD) skyrocketed today following the surprise announcement that the company is selling its Health Clubs division to Quadrant Private Equity for $260 million on a cash‐free, debt‐free basis.

Following a strategic review of its options for the Health Clubs division which includes Goodlife Health Clubs and Hypoxi, management concluded that its sale would create the maximum value for shareholders.

The transaction will strengthen the company’s balance sheet and management advised it will help support the five‐year targeted roll‐out of its Main Event Entertainment centres in the United States.

I believe this is a great decision by the company. Whilst the Health Clubs division had a decent first half to the year, it wasn’t the reason I was bullish on the company. The real reason was the exceptional growth that its Main Event brand is exhibiting in the United States.

In the first half of the year the Main Event division saw US dollar revenues grow by 22.6%. As a result the division has now grown to account for almost one-third of total company sales. With management planning on increasing the total number of centres in the United States by 33% this year, I expect to see it grow its total company sales contribution by the year end.

Ardent Leisure’s CEO Deborah Thomas said this about the transaction:

“The divestment of the Health Club division enables the Group to execute on the pipeline of new high‐yielding Main Event Entertainment centres in the US and disciplined investment in the Theme Parks and Bowling businesses, subject to achievement of return hurdles. In addition, the strengthened balance sheet will provide flexibility to consider capital management initiatives in the future.”

Today’s announcement is yet another reason to be bullish on Ardent Leisure in the long-term as far as I’m concerned. Whilst there are a number of strong companies in the industry, I personally would pick it ahead of Village Roadshow Ltd (ASX: VRL) and Event Hospitality and Entertainment Ltd (ASX: EVT).

Finally, if you are making an investment in Ardent Leisure or any other shares for that matter, I would highly recommend taking a look to see if you own either of these three wealth-destroying shares.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.