Jenny Craig, a Carlsbad, Calif.-based weight loss institution for four decades, will soon be closing its doors, a move that comes amid reported financial troubles and efforts to sell the company.
In a federally mandated WARN Act notice sent out by the company last week, Jenny Craig stated that it planned to close its Carlsbad headquarters by June 24 and as a result would be terminating its 146 employees who work in that location. The letter, however, notes that the closure could come as early as Friday.
“While the Company is making best efforts to secure the additional financing required to continue operations, it may need to close the Carlsbad Facility as early as May 5, 2023, in which case the Separation Date would be the date of the closure,” wrote Jenny Craig.
The headquarters closure is expected to affect the company’s storefront locations across the country. Jenny Craig describes itself as “one of the world’s largest weight loss and weight management companies,” with nearly 500 company-owned and franchised locations in local neighborhoods in the U.S., and Canada, and approximately 600 centers worldwide.
Employees, as first reported by NBC, learned of the impending closure earlier this week in an email sent to them stating that the company would be closing “due to its inability to secure additional financing.”
Sidney and Jenny Craig founded the weight loss company in Melbourne, Australia, in 1983 and moved it to Carlsbad two years later. Sidney Craig stepped down as the company’s CEO in 2003, and he and his wife later sold all of their shares as part of a buyout by Nestle. Sidney died in 2008.
Four years ago, H.I. G. Capital, a global private equity investment firm acquired the company for an undisclosed price. Jeff Zanarini, then managing director at H.I.G., said at the time, “We believe Jenny Craig represents an ideal opportunity to invest in the premier provider of weight loss services, especially with the rising prevalence of overweight adults.”
While the business thrived for its first two decades, at one time rivaling Weight Watchers, it began facing financial challenges as dieters sought out newer weight-loss remedies and cut spending. More recently, Bloomberg reported that Jenny Craig had been seeking a buyer as it continued to overcome growing competition and hype about new weight loss drugs.
Neither Jenny Craig nor H.I.G. Capital could be reached for comment.
