24 Hour Fitness will develop from chapter 11 bankruptcy this week after the gym chain acquired support for its restructuring plan. The US Bankruptcy Court for the District of Delaware approved the group’s strategy, that will make it exit bankruptcy by 31 December 2020.
24 Hour Fitness has ‘overcome’ US$1.2 billion of funded debt and will work with an “optimized cost structure, stronger balance sheet, and enhanced real estate footprint”. It’s believed to have conquered its staffing headcount by approximately 60 percent.
The fitness chain had been taking US$1.3 billion in debt from a 2014 leveraged buyout by a group led by AEA Investors and the Ontario Teachers’ Pension Plan who took 24 Hour Fitness from a private equity firm, Forstmann Little & Co for a reputed US$1.85 billion.
It has not been verified who is carrying the losses it has dropped, nor the arrangement under which this debt has been ‘degraded’.
The company registered for Chapter 11 protection in June, accusing it of an “excessive impact of the COVID-19 pandemic” on its services.
Before the Chapter 11 report, 24 Hour Fitness had about 430 locations. The Chapter 11 method has emerged in the conclusion of more than 100 clubs, moving the company with a network of 286 clubs in the US – 91 are currently open, with 36 of 24 Hour Fitness’ 174 Californian clubs welcoming for outdoor fitness.