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Virgin Active could collapse into administration within days

Virgin Active could collapse into administration within days if a restructuring is blocked by the courts, Sky News understands.

Such a move would potentially put more than 2,000 jobs at risk just as the health and fitness sector tries to return to its feet after a year of turmoil.

Brait, Virgin Active’s majority shareholder, has signalled that it will not inject more capital into the business unless the restructuring is approved.

The proposals are being closely watched among insolvency practitioners and lawyers who believe that their implementation by Virgin Active could herald a wave of similar plans.

Landlords including Aberdeen Standard Investments and British Land have argued that they would be left shouldering a disproportionate part of the financial pain from the Virgin Active deal.

Property owners will be forced to write off millions of pounds in rent arrears and agree to future reductions if the restructuring is approved.

The gyms group, which is part-owned by Sir Richard Branson, says the proposals represent a “holistic but equitable solution, with shareholders contributing over 50% of proposed contributions”.

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