Gym chain 24 Hour Fitness files for bankruptcy, permanently closing 100 US locations after the Covid-19 pandemic forced its clubs to shut down for months
24 Hour Fitness said Monday in its Chapter 11 filing that it has secured $250 million in funding to help reopen some of its clubs and expects a majority of locations to be open by the end of June. However, it's emerging as a smaller chain: It permanently closed 100 US locations in 14 states with roughly 300 clubs remaining. "If it were not for Covid-19 and its devastating effects, we would not be filing for Chapter 11," CEO Tony Ueber said in a statement.
"He also said the restructuring will result in"reinvestment in our existing clubs, opening new clubs and introducing several new innovative products and services." 24 Hour Fitness, which began in 1985, is a privately held company.Middle-tier gym chains are struggling with customers switching to less-expensive fitness facilities, such as Planet Fitness.
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24 Hour Fitness permanently shuts nearly a quarter of its gyms24 Hour Fitness Worldwide Inc. has permanently closed 100 locations, the gym chain said on its website. About a third of the closures are in California. The closures come after the Wall Street Journal reported last week that the company has laid off a number of workers in multiple states, as it struggles with the financial impact of gym closures due to the coronavirus pandemic. The Journal previously reported 24 Hour Fitness was seeking financing to stay afloat during a possible Chapter 11 bankruptcy filing. Last week, the company said it hoped to have 50% of its locations back open by June. Prior to the closures, 24 Hour Fitness had more than 400 gyms in 14 states, with around 22,000 employees.
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