Crunch, a collection of health clubs based in New York City, has reached an agreement to be acquired by its senior secured lenders, New Evolution Fitness Company and certain investing affiliates of Angelo, Gordon & Co.


NEFC was founded by Mark Mastrov and Jim Rowley and provides capital, management oversight, and expertise to emerging fitness companies around the world. Mastrov, a 25-year industry visionary and developer of some of the world’s most renowned fitness brands, is best known for founding and growing 24 Hour Fitness into one the largest and most successful fitness companies in the world.Mastrov and Rowley will serve as Chairman and Vice Chairman of the Board of Directors of Crunch, respectively, [upon completion of the sale], overseeing the existing senior management team of Crunch which will remain with the Company.

To effect the transaction, Crunch has filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code. The sale will be accomplished through a bankruptcy process that permits other interested parties to make competing offers. Subject to the approval of the Bankruptcy Court and other customary conditions, the sale is expected to close in approximately 60 days.


“This process of reorganization, along with the ongoing involvement of NEFC, will allow Crunch to emerge as a strong player focused on what we have become famous for: being the place where entertainment meets fitness,” said Tim Miller, CEO of Crunch. “This transaction will allow us to restructure our balance sheet and close several unprofitable locations. Mark Mastrov and Jim Rowley strongly believe in Crunch and I am confident their industry expertise, vision and leadership will prove to be invaluable as we execute our business plan going forward.”


Crunch said that at this time each of its locations will remain open, other than 25 Broadway and 42nd Street in Manhattan, which will close immediately. 25 Broadway members have been transferred to the company’s new location at 90 John Street, and 42nd Street members will have their memberships transferred to 38th Street or another location of their choice. The company said it has secured sufficient capital to fund operations through its reorganization.


“The NEFC team is excited to be part of the new ownership group of Crunch. I have always considered Crunch to be one of the most innovative and cutting edge brands in the health and fitness industry since its inception in 1989,” said Mr. Mastrov. “I look forward to working with Tim Miller and the entire Crunch management team in growing the Crunch brand, while continuing to deliver the fitness industry’s most unique offerings to our members.”