DISTRESSED DAILY: KKR-Backed Sports Clubs Get Equity Infusion

Luxury sports club operator Bay Club got fresh equity from its private equity sponsor KKR & Co. as it faces lingering problems from a pandemic-induced drop in memberships.

The company, which has clubs primarily on the West Coast, has seen its membership recover to about 80% of pre-pandemic levels and now must face a weakening macroeconomic environment, according to S&P Global Ratings.

Memberships, revenue and cash flows have bounced back slower than expected, the credit grader said in a note, and it may take until next year for the Bay Club’s billings to return to pre-Covid levels. Inflation could ...