LA Fitness debt plans get creditor green light

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Gym chain LA Fitness is to push ahead with a restructuring plan that will see it offload 33 clubs 
in a bid to slash debts by £250 million.

A vote of creditors, including landlords, supported revised lease terms at a number of clubs under a company voluntary arrangement (CVA).

It means the firm can refocus on a portfolio of 47 clubs and secure new lending facilities worth £40m.

Without creditor support for the CVA, accountancy firm Deloitte warned that the company faced the threat of administration.

A marketing exercise has now been started and expressions of interest have been received for all 33 clubs that the Doncaster-based group is selling, including sites in Glasgow and Milngavie.

Chief executive Martin Long said the moves would create a “leaner, more operationally efficient business” with the flexibility to continue investing in facilities, equipment and technology.

The company said the proposals would have no immediate impact on the day-to-day running of the business and that the clubs it plans to sell as part of the CVA would continue to operate as normal in the near term.