WeightWatchers International Inc. is preparing to file for bankruptcy within weeks after securing a debt-restructuring agreement with most of its lenders, sources familiar with the matter said.
The company, struggling under approximately $1.5 billion of debt, intends to use a pre-packaged bankruptcy filing that would allow for a quick exit from Chapter 11 while maintaining daily operations, according to people who asked not to be identified.
Founded in 1963 as a support group for New Yorkers seeking weight loss, WeightWatchers evolved into a global enterprise with its points-based program. The company rebranded as WW in 2018 but has faced declining revenue amid the rise of GLP-1 drugs such as Ozempic.
Related: BowFlex Doesn’t Make It Through Post-Pandemic, Post-Ozempic Environment, Files For Bankruptcy
WeightWatchers’ $500 million of 4.5% bonds due 2029 were recently quoted around 20 cents on the dollar. Company shares closed Wednesday below $0.15, down from a post-pandemic peak exceeding $40.
Former ambassador Oprah Winfrey announced last year she was using weight loss medication and subsequently stepped down from the board, triggering a nearly 20% drop in share price.
Tim Spector, genetics professor at King’s College London, told The Guardian that calorie-counting approaches have become outdated. “It doesn’t work on the vast majority of people,” Spector said.
The company has not commented on bankruptcy reports. Former chief executive Sima Sistani previously compared adapting to the new weight loss drug era to Netflix’s transition from DVDs to streaming.
Information for this story was found via Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
