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đź”´ PRIVATE EQUITY OWNED
24 Hour Fitness
gym chain · San Ramon, CA
PE Firm
Various PE creditors
Year Acquired
2020
“AEA Investors loaded it with $1.8 billion in debt. The workout was the bankruptcy filing.”
The PE Playbook
- •AEA Investors and Ontario Teachers' Pension Plan loaded 24 Hour Fitness with $1.8 billion in debt in their 2014 leveraged buyout
- •Filed Chapter 11 in June 2020 and permanently closed 130+ gyms — over a quarter of its ~445 locations
- •Shrank from 445 locations to 286; workforce reduced by approximately 60% during restructuring
- •Eliminated $1.2 billion in debt by handing ownership to creditors including Sculptor Capital and Monarch Alternative Capital
Since the Acquisition
- ▸Filed for bankruptcy in June 2020 carrying $1.3 billion in PE debt — permanently closed 134 locations, nearly one-third of all gyms
- ▸42 gym closures in California alone, 26 in Texas, 13 in Colorado — entire metro areas lost their nearest location
- â–¸Staffing slashed by 60%, from 19,200 employees to roughly 7,700
- â–¸Members reported annual renewal fees doubled or tripled after restructuring, despite promises of fixed rates