Jenny Craig bankrupt, will close down business in U.S. in Canada | CBC News

After 40 years in business, weight-loss chain Jenny Craig has announced it is closing down in the U.S., Canada, and possibly several other markets around the world.

Reports of the chain’s demise first emerged last week, when the chain was scrambling to come up with cash to cover a looming debt payment, and warning staff of major layoffs to come

The business — which offers pre-made meals and coaching lessons to millions of people trying to lose weight — has roughly 500 franchises across the U.S. and Canada, and more globally.

It was founded by American entrepreneur Jenny Craig in the 1970s but changed hands numerous times over the years.

Its most recent sale was in 2019, when it was purchased by private equity firm HIG Capital for an undisclosed sum.

WATCH | Jenny Craig goes bankrupt:

Weight-loss chain Jenny Craig declares bankruptcy

Weight-loss chain Jenny Craig confirmed what has been rumoured for days: it’s declaring bankruptcy and shutting down operations in both Canada and the U.S. Market watchers say stiff competition from free weight-loss apps and new drugs like Ozempic have taken business away from companies like Jenny Craig.

The chain’s efforts to fix its business proved fruitless as the chain filed paperwork with bankruptcy courts in the U.S. and Canada in recent days.

“Thank you to our loyal Jenny family,” a notice on the company’s website reads. “It’s with a heavy heart we’re announcing the close of our business.”

The move means that effective immediately, all of the chains activities have ceased. Any food scheduled to be delivered has been cancelled, as are all orders for coaching sessions and merchandise sales.

Canadian court filings suggest the chain owes more than $323 million to various unsecured creditors in Canada.

In addition to its core market of North America, the chain also has an extensive presence in Australia and New Zealand, where as recently as last week, the chain was telling its customers there that “local operations are unaffected by the recent news regarding Jenny Craig USA centre closures.”

On Tuesday, local media reports suggest the company has appointed “voluntary administrators” in those two markets, which is a form of corporate restructuring designed to save a viable business, but it’s one that does often end in the business’s closure.

More to come.