Jenny Craig is being revived for e-commerce in the coming months by the maker of a rival provider of weight-loss meals that bought the brand assets of the defunct company from bankruptcy.
Wellful Inc., a direct-to-consumer wellness business that also owns Nutrisystem, said it had acquired the intellectual property rights from Jenny Craig for an undisclosed amount. Court documents dated June 2 show the intellectual property is priced at up to $10 million.
“People who have known about the Jenny brand, the core aspects around great food, training, the overall program and the success they had before, can look forward to it again,” Wellful CEO Brandon Adcock said in an interview. .
Jenny Craig’s website has teased a reboot in recent weeks, saying it’s “coming home this fall.” Adcock said all of Jenny Craig’s former clients have been notified via email and on the brand’s Facebook groups about the relaunch.
“Our goal is just to treat them to the best of our ability to get their business back,” he said.
After four decades in business, Carlsbad, California-based Jenny Craig filed for Chapter 7 bankruptcy in Delaware on May 5. court records show. The filing came two days after NBC News reported that the company had alerted employees to an impending closure, sparking a class action lawsuit accusing management of violating 60-day notice requirements for mass layoffs.
Jenny Craig could not be reached for comment at the time. HIG Capital, the $55 billion private equity firm that acquired the brand for an undisclosed sum in 2019, did not respond to requests for comment on the case or the Wellful acquisition.
The iconic weight-loss provider’s next act will be powered by e-commerce and digital, Adcock said. Members will still be able to order meals delivered to their doorstep and will still have access to one-on-one coaching, a core feature that was previously delivered at hundreds of physical locations, but will now be completely virtual. The Wellful acquisition does not include any Jenny Craig real estate, he said.
Wellful is a private company formed by the merger of 2021 of Nutrisystem and Adaptive Health, which Adcock co-founded in 2009. The company is majority owned by Kainos Capital, a Dallas-based private equity firm specializing in food and consumer products, which closed a billion dollar fundraising round in February.
Traditional diet and exercise brands have faced stiffer competition from a rapidly expanding variety of weight-loss drugs, such as Ozempic, which are gaining popularity. Adcock said he’s confident that both Nutrisystem and a revamped Jenny Craig can compete.
“The knowledge that we have of speaking to the consumer in this category through our business with Nutrisystem, we will definitely be able to do that for Jenny Craig,” he said. But she acknowledged that “it’s obviously a very changing environment” and said she’s looking at the role pharmaceuticals play in the industry.
Adcock said Jenny Craig and Nutrisystem, which also sells prepared meals focused on weight loss but does not provide training, would be run separately within Wellful. He said Jenny Craig’s prices would remain similar to what they were before her bankruptcy, but declined to share any further details.
Since Jenny Craig went under, customers have expressed their sadness and frustration on social media. Some said they rushed to brick-and-mortar stores in the days after the closure news broke to pick up their final food orders before the locations closed for good in early May. Several said they hadn’t and were still trying to get their money back.
In still-functioning private Facebook groups where members once met to share weight-loss tips and support, nostalgic patrons have been swapping recipes and cooking tips to try and recreate their favorite Jenny Craig meals. Some have enthusiastically posted about the brand’s long-awaited renaissance, while others vowed never to return.
Jenny Craig had employed about 1,000 people in the US when it closed, several corporate employees, including a human resources official, said at the time. Adcock said Wellful is looking to rehire some former employees as needed.
“We have already spoken with several trainers, and we will continue to speak with more about starting to work on the brand,” he said.
Jack Raisner, the attorney representing former Jenny Craig employees in the class action lawsuit filed in May, said the case is on hold while the bankruptcy court deals with the company’s remaining assets and liabilities. Wellful is not affected by the class action lawsuit.
Raisner’s clients are seeking payment of wages they say they are owed under state and federal WARN Act rules, which generally require companies with at least 100 full-time workers to notify regulators and employees 60 days in advance. of mass layoffs or site closures. The complaint alleges that hundreds of former Jenny Craig employees may be owed restitution.
