The U.S. Bankruptcy Court for the District of Delaware late Tuesday confirmed the reorganization Plan for 24 Hour Fitness. With this confirmation, 24 Hour Fitness will reduce approximately $1.2 billion of funded debt and expects to emerge from Chapter 11 by December 31, 2020.
Chief Executive Officer Tony Ueber stated, “We’re pleased to announce that, with confirmation of the Plan, 24 Hour Fitness is firmly on track to emerge from chapter 11 by the end of the year. The Court’s decision reinforces the strength and promise of our business strategy and our plans for the future. Most importantly, it ensures we will continue our mission of helping to transform the lives of our members every day through fitness long into the future, thanks to the talented and inspirational community of 24 Hour Fitness team members and the support of our lenders and other stakeholders.”
Upon emergence, the company will operate with an optimized cost structure, leaner balance sheet, and improved real estate footprint, allowing it to continue offering best-in-class fitness experiences across the country as it has done for more than 35 years.
The company said it is committed to providing a safe and friendly environment for members to enjoy the benefits and rewards of leading a healthy lifestyle. Besides motivating its club community with the support of its fitness professionals, keeping members safe is a priority for the company across its network of nearly 300 clubs nationwide. Additionally, at a time when access to fitness is more important than ever, club members will be able to continue using any open 24 Hour Fitness club, regardless of membership level, through March 2021.
Lazard is acting as a financial advisor, FTI Consulting is acting as restructuring advisor and Weil, Gotshal & Manges LLP and Ropes & Gray LLP are acting as the company’s legal counsel in connection with the company’s Chapter 11 cases. PJT Partners is a financial adviser and O’Melveny & Myers LLP is legal counsel to the ad hoc group of debt holders. More information about the Chapter 11 cases, including access to Court documents, is available here.
Photo courtesy 24 Hour Fitness
