Bally files reorganization plan |
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Thu, 02 Aug 2007 00:23
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CHICAGO (AP) - Fitness center operator Bally Total Fitness Holding Corp. said Wednesday that it has filed a voluntary Chapter 11 reorganization plan in a New York court.The bankruptcy proceedings, filed Tuesday night with the U.S. Bankruptcy Court for the Southern District of New York, seek court approval of the reorganization plan, which the company's bondholders have already voted to support.Chicago-based Bally said it will continue normal club operations during restructuring and believed it could pay employees and vendors. The company operates more than 375 facilities in 26 states, Mexico, Korea, China and the Caribbean.'The Chapter 11 financial restructuring enables us to strengthen our balance sheet, while providing us with capital to make necessary investments in our clubs and facilities to better serve our valued members, as well as attract new members,' Don R. Kornstein, Bally's interim chairman and chief restructuring officer, said in a news release.The plan would reduce Bally's debt by $150 million, reduce cash interest expense by $29 million and provide the company with $90 million in capital through the issuance of new senior subordinated notes, according to the release.The company hopes to emerge from bankruptcy 'as promptly as possible,' the release said.Bally said in March that it might have to file for bankruptcy, citing more than $800 million in debt and just $45 million in cash on hand. It has since defaulted on its debt and been delisted by the New York Stock Exchange.Bally shares, now traded on the over-the-counter Pink Sheets, closed down 5 cents Wednesday to 36 cents.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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Bally files approved reorganization plan 