24 Hour Fitness Worldwide Inc. filed for Chapter 11 bankruptcy on Monday.
The company, which is headquartered in San Ramon, Calif., announced it has permanently closed about 130 gyms in the United States after the temporary closures and uncertainty caused by the COVID-19 pandemic. The national gym chain expects to secure about $250 million in funding to help the remaining 300 locations.
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The company released a statement titled “We’re here for the long run.”
“24 Hour Fitness is dedicated to the health and wellness of our members, our team and the communities we serve, and has been for more than 35 years,” the statement read. “With the dramatic impact of the COVID-19 pandemic on the economy and the fitness industry, we are announcing a financial restructuring through a voluntary Chapter 11 filing that we expect will make us a stronger company. We will continue reopening clubs with a focus on uninterrupted service to our members, and we’ll be able to reinvest in existing clubs, open new clubs and offer new innovations to better serve you long into the future.”
While some gyms will never reopen, 24 Hour Fitness has been able to reopen some gyms in California, Colorado, Florida, Hawaii, New Jersey, Nevada, New York, Oregon, Texas, Virginia and Washington. Bloomberg reported in May that, prior to COVID-19, 24 Hour Fitness had more than $1.3 billion of debt due to a 2014 leveraged buyout by AEA Investors and the Ontario Teachers’ Pension Plan. Similarly, Gold’s Gym filed for bankruptcy in May.
“If it were not for COVID-19 and its devastating effects, we would not be filing for Chapter 11,” 24 Hour Fitness CEO Tony Ueber said in a statement, according to Business Insider. “With that said, we intend to use the process to strengthen the future of 24 Hour Fitness for our team and club members, as well as our stakeholders.”
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