Rainer Schaller, the founder of budget gym megabrand McFIT, has added iconic franchised chain Gold's Gym to his portfolio of fitness businesses.
The deal, worth around US$100m, will see Gold's Gym join the Rainer Schaller Global Group (RSG Group), which already owns and operates three fitness chains – McFIT, John Reed and High5 – and a number of other lifestyle brands.
RSG was selected as the winning bidder in a court-approved auction process held yesterday (13 July).
Following the acquisition, the RSG Group – which has mainly been active in Europe up to this point – has, overnight, become a global player in fitness with more than 900 locations across six continents.
Established in 1965, the US-based Gold’s Gym has been hit hard by the COVID-19 pandemic and filed for Chapter 11 protection on 4 May, 2020, in an effort to facilitate the financial restructuring of the company.
In mid-May, as part of the initial bankruptcy filing, Gold’s Gym announced its plan to emerge from bankruptcy quickly through a pre-negotiated plan from its majority owner, TRT Holdings.
After "extensive negotiations" with TRT Holdings and its creditors, Gold’s Gym announced, in late May, that it would implement a court-approved marketing process – with TRT Holdings serving as a stalking horse bidder.
At the conclusion of the auction, Gold’s Gym announced that, subject to final approval from the bankruptcy court on 24 July 2020, RSG Group would be the purchaser of the company and its assets, with an estimated final price of US$100m.
Subject to approval, Gold’s Gym will emerge from bankruptcy with 61 company-owned gyms and more than 600 franchised locations.
“Gold’s Gym is a fitness institution that had a major influence on the industry’s development," said Rainer Schaller, RSG Group founder and CEO.
"It was a huge source of inspiration when I was setting up my first McFIT studio in Würzburg, Germany back in 1997.
“I'm incredibly proud that, in partnership with its current leadership team, we will be able to breathe new life into this iconic brand under the umbrella of the RSG Group.”
“Instead of my original idea of slowly approaching franchising in the fitness sector, we are now diving in headfirst.
"This is the start of a new era for the RSG Group and I’m really looking forward to its success.
“With the acquisition of Gold’s Gym, we are taking on a legacy that I have the utmost respect for. Our goal is to focus on the core values of Gold’s Gym and find the right balance between preserving its roots and moving the brand forward."
RSG Group currently has more than 5,000 employees in 48 countries. It operates 17 brands across multiple sectors – including fitness, lifestyle, design and fashion. • To read a wide-ranging interview with Rainer Schaller in which he discusses the RSG Group, click here for HCM Issue 4 2019
The deal comes just a month after Gold's Gym announced the launch of a smaller footprint model
to its range of franchise offerings to make the brand more attractive to franchisees with smaller budgets and enable more mass-market penetration globally.
Sebastian Schoepe, president of the RSG Group North America, who will be responsible for the migration of the Gold’s Gym brand into the RSG Group, added: "As we bring together our two teams, it is particularly important that we actively involve all team members and franchisees in the process.
"If we integrate their ideas into the expansion of the brand, we are confident that we will achieve our goal of leading Gold's Gym into a successful future."
Adam Zeitsiff, president and CEO of Gold's Gym, said: "The RSG Group, with nearly 25 years of owner-managed expertise in the fitness sector, lives and breathes fitness and that is reflected in everything they do and how they do it.
"For us, this acquisition will open up brand-new opportunities to lead Gold's Gym into a strong future together. My team and I are excited to partner with RSG and we look forward to much success for our team members, our members, and our global brand."