(Reuters) – U.S. health-club operator Bally Total Fitness Holding Corp has reached a deal with its lenders on a restructuring plan to help it exit from bankruptcy.
Bally’s senior lenders, including JPMorgan Chase & Co (JPM.N), have agreed to cut the health-club operator’s debt by at least $660 million, court papers show.
The balance sheet restructuring also provides for new financing.
Under the agreement, Bally’s lenders will get 94 percent of the restructured company’s equity, court papers show.
The plan requires court approval.
Bally, one of the largest U.S. health-club operators, filed for bankruptcy protection for the second time in 17 months in December.
As of end-December, Bally operated 328 fitness centers in 25 states and the company and its non-debtor affiliates had consolidated assets of about $1.16 billion and consolidated liabilities of about $1.58 billion.
The case is In re: Bally Total Fitness of Greater New York Inc et al, U.S. Bankruptcy Court, Southern District of New York, No. 08-14818. (Reporting by Ajay Kamalakaran in Bangalore and Anupreeta Das in New York; Editing by Dhara Ranasinghe)