LA fitness creditors approve club sell-off proposals

LA fitness has secured approval from the required majority of creditors for its company voluntary arrangements (CVAs) which include the proposed sale for 33 of its UK clubs.

The plans, which were initiated on 6 March 2014, received strong support from landlords – the largest group of unconnected creditors – with more than 90 per cent voting in favour of the terms.

The CVAs revise lease terms at a number of LA fitness clubs, paving the way for a restructuring plan to refocus LA fitness on a smaller portfolio of 47 clubs, while reducing its debt burden to secure the chain’s long-term future.

LA fitness CEO Martin Long said: “We are now able to focus on the long-term future of LA fitness as we create a leaner, more operationally efficient business with the financial strength and operational flexibility to continue investing in facilities, equipment and technology across our retained portfolio of clubs.”

According to the chain, there has been interest in all 33 clubs up for sale, which will continue to operate as normal in the near-term with every effort being made to ensure members are unaffected. It is also expected that the majority of the existing employees will continue to be employed under a Transfer of Undertakings (Protection of Employment) (TUPE) structure by potential new owners.