Bally Total Fitness files for Ch. 11

By Ryan on August 3rd, 2007

Bally Total Fitness, one of the country’s largest fitness chains, filed a plan late Tuesday in U.S. Bankruptcy Court for the Southern District of New York. The plan would reduce its debt by $150 million and bring in $90 million in new capital for investing in some of its 375 clubs nationwide.
Company officials said the bankruptcy protection filing would not affect operations at the clubs.

“This is a positive step to ensure Bally’s future success,” said Don Kornstein, Bally Total Fitness interim chairman. “Members, employees and vendors will not be adversely impacted.”

According to its 2006 annual report, Bally’s membership declined every quarter last year on an annual basis, as well as the first quarter of 2007. The company reported a loss of $107.6 million in fiscal year 2006, ended Dec. 31.

Bally Total Fitness was a major player in fitness centers , but in recent years has faced competition from other well established clubs and new comers to the market. 

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