VIRGIN Active’s 43 gyms in the UK could face closure if a restructuring plan isn’t agreed.
The group, which is part owned by Sir Richard Branson, has 2,400 employees in the UK and without a deal their jobs would be at risk, according to Sky News.
Gyms have been closed for much of the pandemic due to lockdown and tier restrictions, which has hit operators such as Virgin Active.
Virgin Active’s majority backer Brait, which owns 72% of the group alongside the 18% owned by founder Sir Richard Branson, said revenues halved last year due to the pandemic.
By the end of February 2021, Brait said, Virgin Active’s UK clubs had been
closed or partially closed for nine of the previous 12 months.
Without the go-ahead for the new deal, which needs £45million in new cash and extensions on existing loans, the group could fall into administration.
It is also asking landlords for support over rental payments and arrears.
Virgin Active has been asked for comment but a spokesman told Sky News: “Virgin Active UK was a successful business going into the pandemic and has exciting growth opportunities for the future.
“It has launched a restructuring plan which includes shareholders contributing an additional £70m in total and has support from its banks.
“This proposal will provide greater financial flexibility, thereby enabling us to emerge from the crisis as a stronger business, better placed to capitalise on a growing health and wellness market.”
What happens to gym memberships during lockdown?
GYMS have been closed during most of the pandemic and providers haven’t been taking payments from members while they are closed.
Virgin Active has said 25% of its users have quite their membership during the pandemic.
But those who are sticking with the brand are currently not being charged.
It has previously reinstated memberships once clubs are allowed to reopen so you should decide if you plan to return before your monthly payments begin again once gyms can reopen in April.
The restructuring only applies to the UK business.
Virgin Active also has hundreds of clubs across the world including in Australia, Botswana, Italy and South Africa.
Gyms are set to reopen from April 12 in England as part of Prime Minister Boris Johnson’s roadmap out of lockdown – but classes won’t start again until mid-May.
Health clubs and gyms will be allowed to reopen from April 12 as long as strict conditions are met, meaning Brits will no longer be limited to working out outside.
However, group exercise classes won’t restart until mid-May under the plans, when restrictions could start lifting for indoor gatherings.
Many businesses have struggled due to closures during the pandemic, particularly high-street retailers.
It’s estimated that over 43,000 retail jobs have been axed since the start of coronavirus lockdown as high street struggles to survive.
John Lewis closed eight stores in July last year, in a move that put 1,300 jobs at risk and has said there may be more closures.
Topshop, Topman and Miss Selfridge have also closed following the collapse of Sir Philip Green’s Arcadia retail empire.
They have been purchased by ASOS.
Matalan launches HUGE online clearance sale with prices starting from 50p
Free school meals and help with bills fund extended over Easter holidays
6 McDonald’s menu items being axed in March leaving fans ‘raging’
Martin Lewis warns 200,000 women could be owed £13,500 pension payout
7 rarest old coins including London Mint sovereign worth up to £25,000
IN A TIZZ
Aldi shopper in hysterics after thinking Lemon Fizz hand gel had ‘rude typo’
Before gyms open their doors once again, outdoor sports – such as tennis and golf – are expected to return from March 29.
Pubs are also set to reopen outdoors in April. Check the reopening plans from some of the main pub groups.
Punters will have to follow a strict set of rules when pubs and restaurants do open again.