A part-owner of the Sacramento Kings, an advisor to the billionaire Desmarais family and the founder of Canada’s only sports-focused private equity firm have left the board of directors of SNFW Fitness B.C. Ltd., which sought creditor protection in April owing in excess of $35 million.
According to corporate documents filed May 6, the company's three long-serving directors ceased serving as directors on March 27 – 10 days after the company closed all of its 29 fitness locations, and terminated nearly all of its 1,300 staff members.
SNFW Fitness – which operates facilities under Steve Nash, UFC Gym and Crunch Fitness brands – began a court-approved sales process in late April while under creditor protection. This week, BIV learned that a buyer for the company has been confirmed. Details of the bid, which will require court approval, have not been disclosed.
Leonard Schlemm and Mark Mastrov – co-founders of 24 Hour Fitness – established Steve Nash Sports Clubs in partnership with Canadian basketball legend Steve Nash in 2007, two years after 24 Hour Fitness was sold to private equity firm Forstmann Little & Co. for US$1.6 billion.
The company merged with then 50-year-old Fitness World two years later to form Steve Nash Fitness World and Sports Clubs.
Both Schlemm and Mastrov, along with Rob Fetherstonhaugh, were listed as board directors of SNFW Fitness in a December 2019 document obtained by BIV through BC Registry Services. They were also listed as directors back in 2014. Schlemm additionally served as company chair and CEO in 2015, 2016 and 2017, and as chair in 2018.
Mastrov, based in California, is currently chairman of New Evolution Ventures and executive chairman of UFC Gym, to which SNFW Fitness acquired the B.C. rights in 2016. Mastrov is also part of the ownership group behind the National Basketball Association’s Sacramento Kings.
Schlemm, based in Quebec, is the managing partner of LangLeven Group, which markets itself as Canada’s first and only private equity firm focused exclusively on the North American sports industry. The group has a market value of $100 million, according to its website.
He is married to Annick-Isabelle Marcoux, LangLeven founder and managing partner. Previously, Marcoux managed a high-end group of fitness clubs, according to her biography. Prior to that, she led a division of the private wealth group at BMO Harris Private Banking, which developed strategies for ultra-high net worth clients of BMO Financial Group.
According to court documents, SNFW Fitness has approximately $38.8 million in authorized borrowing facilities from the Bank of Montreal – its primary secured creditor and single largest creditor. In a first report to court, the proposal trustee for SNFW Fitness noted approximately $32 million had been drawn from those facilities.
The company additionally owes at least $3.4 million to unsecured creditors. That figure does not include amounts owing to former employees, to landlords or to members who prepaid for memberships or personal training sessions they have been unable to use since March.
In a 2017 interview, SNFW Fitness president Chris Smith said the company had more than 100,000 members. Some of those members have advanced thousands of dollars to the company for personal training sessions.
Fetherstonhaugh, the third former director, is lead director of Lakefield Veterinary Group – a veterinary hospital acquisition company owned by Canada’s billionaire Desmarais family. Fetherstonhaugh is also president and chief operating officer of Belvoir Investments Corp., the holding company for the family of Paul Desmarais Jr., former co-CEO of Power Corp. of Canada.
BC Registry Services confirmed to BIV that the change in directors was filed by the company in May, after SNFW Fitness filed a notice of intention to file a proposal under Canadian bankruptcy and insolvency legislation. BC Registry Services also confirmed that it is common for a notice of a change of directors to include a date of change that is earlier than when the change is filed.
Read more stories about SNFW Fitness:
- No recovery to unsecured creditors of Steve Nash Fitness
- Club16 takes over two former Steve Nash Fitness locations
- BIV exclusive: Steve Nash Fitness co-founder part of potential takeover
- Steve Nash Fitness announces acquisition, re-opening strategy
- Steve Nash Fitness granted insolvency extension
- Members owed millions as Steve Nash Fitness heads to court
- More time needed to evaluate bids for Steve Nash Fitness
- Creditors await result of Steve Nash Fitness sales process
- Steve Nash Fitness World to seek prospective buyers
- Updated: Members still paying fees at Steve Nash Fitness despite insolvency
- Steve Nash Fitness World seeks creditor protection owing $35M
- Steve Nash Fitness terminates workers across the entire chain
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