THE COVID-19 crisis has just claimed a major victim in the fitness industry.
Major fitness chain Gold’s Gym has filed for Chapter 11 bankruptcy protection in the United States.
“On May 4, 2020, GGI Holdings, LLC and its affiliates (‘Gold’s Gym’) filed voluntary petitions for relief under Chapter 11 in an effort to facilitate the financial restructuring of the company,” the company said in a business statement.
In a separate statement, however, the company assures the public: “Gold’s Gym has been the world’s trusted fitness authority for more than 50 years, and we’re absolutely not going anywhere.”
In a video, the company’s president and CEO Adam Zeitsiff said, “I wanna reassure everyone who's watching this video around the world that we are not going out of business.”
The purpose of the filing, said Zeitsiff, was to “maintain the strength and growth potential of the Gold’s Gym brand, as well as ensure the continued viability of the company for decades to come.”
He laid the blame for their current financial restructuring squarely on the shoulders of the ongoing pandemic.
“The COVID-19 global pandemic has affected Gold’s Gym deeply and in many ways,” said Zeitsiff.
In the United States, Gold’s Gym has needed to permanently close “around 30” company-owned gyms to remain in business throughout the crisis.
The company also said that the filing will not affect its licensing business or its locally-owned franchise gyms around the world. “Nor will it prevent us from continuing to support our system of nearly 700 gyms around the world,” the statement continued.
In addition, it will continue to operate as normal: reopening temporarily closed branches as state quarantine laws apply, paying its team members wages and benefits, and fulfilling obligations to its suppliers and vendors.
The company expects to be “on the other side of Chapter 11 by August 1, 2020, if not sooner.”
For its part, Gold's Gym Philippines has said that it is in no way affected by what's happening stateside. "The financial restructuring of the operating arm of Gold's Gym in the US is unrelated to its franchise division," it said in a statement released over social media.