Gold’s Gym filed bankruptcy protection
- Gold’s Gym filed for Chapter 11 bankruptcy protection, as the Covid-19 pandemic adversely hit the US economy.
- The 55-year old company is planning for restructuring
- The director and co-founder Gold’s Gym India, Karan Valecha said that “being a master franchise its business remains separate from the global chain”.
Lockdown due to Covid-19 had adversely hit the business across the world; gyms are a common example of a venture that remained closed during this period.
One of the leading chains of gyms, Gold’s Gym has filed for bankruptcy security under Chapter 11 of the country’s bankruptcy code. On May 4, 2020, this move has been taken to facilitate the financial reformation of the company.
The current situation has forced Gold’s Gym to closed 30 outlets to ensure feasibility.
However, it also said that the filing “should not impact our licensing division” as it is not linked with any of its locally-owned franchise gyms.
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The company stated that “While the COVID-19 pandemic certainly impacted our company-owned gym operations, we expect the filing will have no further impact on current operations,”
Also on video statement, Gold’s Gym President and CEO Adam Zeitsiff said, “This has been a complete and total disruption of every one of our business norms, so we needed to take quick, decisive actions to enable us to get back on track”. He added more by saying that by August 01, 2020, the company hopes to come out on the other side of Chapter 11.
The chairman and Co-founder of the Gold Gym Karan Valecha said that “I would like to personally reassure you that this does not have any impact on Gold’s Gym India as a Master Franchise and we are committed to giving you the best fitness experience as we have for the last 17 years and counting,”.
However, the business in India will remain safe and have no crash from the financial reformation of the parent company. The director and co-founder of India Gold’s Gym, Karan Valecha, said that being a master franchise its dealing remains apart from the worldwide chain.