Blink Fitness Scores $105M Deal For NY, NJ Gyms

Bankrupt gym chain Blink Fitness has revealed that a global fitness club operator backed by KKR has agreed to pay $105 million in cash to acquire a “substantial portion” of Blink’s gyms and corporate operations, setting a baseline bid for an auction slated for next month. 

Blink disclosed in a statement Tuesday that the bidder, U.K.-based PureGym Ltd., is committed to keeping Blink’s locations in New York and New Jersey open and plans to further invest in the facilities. PureGym would also assume certain Blink liabilities as part of the deal, the debtor said.

“As we have worked this year to reinvigorate our most popular locations and elevate our member experience, we are encouraged by PureGym's interest in the Blink business model and strategy, and their belief in Blink's mission to democratize fitness for all,” Blink CEO Guy Harkless said in the statement. 

PureGym’s stalking horse bid will serve as a floor price at an auction Blink will conduct Oct. 28 if it receives competing offers. 

Blink announced the PureGym offer at a Delaware bankruptcy court hearing Tuesday.

At the hearing, the debtor received U.S. Bankruptcy Judge J. Kate Stickles’ approval to borrow a total of $73.5 million in bankruptcy financing, consisting of $21 million of new money and a rollup of $52.5 million in prepetition debt. 

Unsecured creditors of the company objected to the debtor-in-possession financing, arguing that Blink’s lenders would receive excessive protections and that the DIP budget would allocate the creditors committee too little money. 

Judge Stickles sustained the creditors committee’s objection to the budget, instructing “all estate professionals to share pro rata” funds under the DIP budget. 

The judge also blessed Blink’s plan to incentivize key employees in connection with its sale effort. 

Blink, an affordable gym company owned by luxury fitness club chain Equinox, has about 80 locations in New York, New Jersey, California and elsewhere. It filed for bankruptcy in August with plans to find a buyer.

PureGym’s purchase offer does not include Blink’s gyms in Texas, Illinois and California, according to the statement. 

Blink is represented by Michael R. Nestor, Sean T. Greecher, Allison S. Mielke, Timothy R. Powell, Rebecca L. Lamb and Benjamin C. Carver of Young Conaway Stargatt & Taylor LLP. 

The case is In re: Blink Holdings Inc., case number 24-11686, in the U.S. Bankruptcy Court for the District of Delaware. 

—Editing by Covey Son and John Campbell.