RSG Group GmbH, the Berlin-based fitness company that owns the McFit chain, won a court-approved auction to buy Gold’s Gym for $100 million, according to a news release.
Gold’s saw its business drop during the COVID-19 pandemic and filed for court protection in May. The company tapped a $20 million bankruptcy loan shortly after to keep operating even as most of its gyms remained shut.
The iconic American gym will emerge from bankruptcy with a healthy balance sheet, 61 company-owned gyms, and more than 600 franchise-owned gyms, according to the RSG news release. The sale still needs to be approved in a bankruptcy court hearing scheduled for July 24.
“Gold’s Gym is a fitness institution that had a major influence on the industry’s development. It was a huge source of inspiration when I was setting up my first McFit studio in Würzburg, Germany back in 1997,” RSG Group’s founder and CEO Rainer Schaller said in the statement.
Representatives for Gold’s didn’t immediately respond to an email seeking comment.
Retired merchant marine veteran Joe Gold launched his fitness empire in a rough cinder-block building near Muscle Beach in Venice, California in 1965 with weight-lifting equipment he built himself. The company had its strongest-ever year of worldwide growth in 2019, but the coronavirus, social distancing and gym closures were a major blow to its business.
“No single factor caused more harm to the debtors’ business than the current COVID-19 pandemic,” the company said in a court filing when it furloughed almost 4,600 employees and declared bankruptcy. — Bloomberg
