Meridian Sports Clubs California said Thursday it exited Chapter 11 financial reorganization. The company’s new financing includes a $7.5 million term loan extended in part by Praesidian Capital and a $4.5 million revolving credit facility with Praesidian. Meridian operates fitness clubs in California, Hawaii and Nevada.
LOS ANGELES–(BUSINESS WIRE)–Meridian Sports Clubs California, LLC (Meridian), which operates fitness clubs in California, Hawaii and Nevada, announced today it has completed its Chapter 11 financial reorganization and emerged with new equity owners and financing to provide new opportunities for its operations going forward. Under the Plan of Reorganization which is now in effect, Meridian exchanged debt for equity which is held by an affiliate of Praesidian Capital, a leading provider of mezzanine capital for small and mid-sized companies, and an affiliate of another mezzanine lender. The new financing includes a $7.5 million term loan extended in part by Praesidian and a $4.5 million revolving credit facility with Praesidian.
“We are pleased to have completed this process in less than eight months and to have achieved our main objective – the deleveraging of the company so that it has a strong financial structure for the future,” stated Jason Drattell, Praesidian founder and managing partner. “On behalf of the entire management team, I want to thank all the employees, vendors, and members whose support has made this successful transition possible.”
Drattell also noted that the company had recently opened a new club in Honolulu called Island Club and Spa. Island Club and Spa represents the most luxurious and sophisticated gym and spa on Oahu, with advanced fitness equipment lines and extensive spa services.
“Having worked with the fitness industry in the past, we understand the importance of creating the right brand and providing the right services to members,” he noted. “We are excited about the opportunities the new Meridian presents, particularly as we invest new money into facilities to ensure they meet the high standards our clients both expect and anticipate.”
During the Chapter 11 case, Meridian was advised by its bankruptcy counsel, Pachulski Stang Ziehl & Jones LLP. Praesidian was advised by Morrison Cohen LLP. The creditors committee was represented by Sheppard Mullin Richter & Hampton LLP. The company today serves about 15,000 members.
About Praesidian Capital
Praesidian Capital partners with small and mid-sized businesses by providing private debt capital. With a focus on its core competency in mezzanine financing, Praesidian invests in established, historically profitable companies often in connection with a management/leveraged buyout, recapitalization or refinancing. Based in New York City, Praesidian manages more than $700 million in committed capital. For more information, visit www.praesidian.com.