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Gym chain Blink Fitness announced Monday that it filed for Chapter 11 bankruptcy.
The Chapter 11 filing is meant to help the Equinox Group-owned chain “execute an efficient and value-maximizing sale process to optimize its footprint and position the business for long-term success,” according to a news release.
Blink said it will keep its gyms open in the meantime. It has more than 100 locations spread across seven states.
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“Over the last several months, we have been focused on strengthening Blink’s financial foundation and positioning the business for long-term success,” CEO Guy Harkless said in a statement. “After evaluating our options, the Board and management team determined that using the court-supervised process to optimize the Company’s footprint and effectuate a sale of the business is the best path forward for Blink and will help ensure Blink remains the destination for all people seeking an inclusive, community focused gym.”
An image of the sign for Blink Fitness as photographed on March 18, 2020, in Hicksville, New York. (Bruce Bennett/Getty Images / Getty Images)
It plans to pay vendors and suppliers “in full under normal terms for goods and services provided on or after the filing date,” Blink said.
Blink’s existing lenders have committed to giving the fitness chain $21 million in new debtor-in-possession financing.
In its Chapter 11 filing, the company pegged the value of its assets to be in the $100 million to $500 million range. Estimated liabilities were reported as the same, according to the document.
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Blink’s chief restructuring officer said in another filing Blink has experienced “liquidity constraints” stemming from temporary closures and other pandemic-related effects.Â
Other fitness chains were also heavily impacted by the COVID-19 pandemic.Â
A Blink Fitness gym remains closed on May 13, 2020, in New York City as COVID-19 spread to most countries around the world. (Rob Kim/Getty Images / Getty Images)
Some people turned to exercising at home instead of at gyms during the pandemic, with chains working since then to bring members back. Some chains in the industry have also been contending with high costs.
Blink said Monday it “remains committed” to the plans it recently unveiled to revamp 30 of its most popular locations with new gym equipment and recovery options and other efforts to attract more members.
The company also forecast it would “deliver the best top and bottom line performance over the last five years” in 2024 after experiencing a nearly 40% jump in revenue in the prior two years.