In a new move to capture the budget fitness market, Planet Fitness is attempting to acquire Blink Holdings – a brand that filed for bankruptcy in August. If successful, this acquisition could mark a turning point in Planet Fitness’s expansion journey, especially amid increasing competition in the U.S. According to court filings seen by CNBC, Planet Fitness has submitted two new offers after initially losing out to PureGym, a fitness chain from the U.K.
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Blink Holdings is part of the Equinox Group, known for its high-end fitness centers. However, Equinox’s attempt to enter the budget-friendly market through Blink failed, leading the brand to file for bankruptcy. Since then, over 100 Blink fitness centers have been “frozen” in bankruptcy proceedings. Last week, PureGym won the auction with a bid of $121 million to acquire Blink’s assets, including 60 gyms in New York and New Jersey.
If the acquisition goes through, PureGym would further strengthen its presence in the U.S. The U.K.-based chain entered the U.S. market in 2021 and quickly made an impact with its affordable, consumer-friendly model. PureGym’s presence offers consumers access to quality gyms at an affordable price, creating a viable alternative in the market.
The Rise of the Budget Fitness Market in the U.S.
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In recent years, the budget gym segment has boomed in the U.S. as more consumers seek affordable fitness options. Budget chains like Blink have become popular because they don’t require high membership fees while offering effective basic services. This trend has fueled intense competition among major fitness chains, pushing brands to constantly adapt to changing consumer demands.
Antitrust Concerns Facing Planet Fitness
Although Planet Fitness is one of the largest fitness chains in the U.S. with over 2,000 clubs, it continues to seek opportunities to expand its market share. However, one of the main obstacles Planet Fitness faces is antitrust concerns. If Planet Fitness proceeds with acquiring Blink, it could further strengthen its dominance in the budget gym segment, risking a potential monopoly. According to Piper Sandler estimates, Planet Fitness already holds a significant share of the fitness club market in the U.S., and acquiring Blink could expose it to legal challenges regarding competitive practices.
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To address these challenges, Planet Fitness has submitted two separate bids for Blink. The first bid offers $142 million, including a $28.4 million deposit, on the condition that it does not need to address antitrust issues in advance. In contrast, the second bid raises the offer to $155 million, with a $31 million deposit, and agrees to file certain legal documents to meet antitrust requirements. A bankruptcy court hearing in Delaware is scheduled for Wednesday at 11 a.m. ET to review the new bids.
The Potential of Blink Holdings Under Planet Fitness
If successful, acquiring Blink could bring significant benefits to Planet Fitness. Blink would not only increase the number of gyms under Planet Fitness but also open up opportunities to attract a new customer base, especially those prioritizing cost-effectiveness. A combination of Blink and Planet Fitness could create a diverse gym chain catering to a wide range of U.S. consumers, from budget-friendly to premium.
Beyond financial gains, Blink could contribute to Planet Fitness’s growth strategy by expanding its geographic footprint. With over 100 fitness centers across the U.S., Blink could serve as a valuable asset for Planet Fitness to access new regions, further solidifying its position in the industry.
Competitor Response and Ford’s Statement
With news of the potential acquisition, many of Planet Fitness’s competitors are closely monitoring the situation. Planet Fitness has yet to respond publicly to these new bids and has not returned CNBC’s request for comment.
Meanwhile, Ford – a company with significant interests in the manufacturing sector, which often involves large acquisitions – extended congratulations to Trump and newly elected officials. “We look forward to working with the new administration and Congress to build policies that support the U.S. automotive industry, which provides jobs for 9.7 million Americans and contributes over $1 trillion to the economy each year,” a Ford representative shared.
Long-Term Impact and Final Outcome
Planet Fitness’s bid to acquire Blink is not merely a financial transaction but a reflection of growth and expansion trends in the fitness industry. Budget fitness chains are becoming more popular, emerging as a top choice for consumers, while also putting pressure on premium chains. The outcome of the upcoming hearing will determine whether Planet Fitness can carry out its expansion plan and may lead to significant shifts in the U.S. gym market.
