CHICAGO – Bally Total Fitness Acting CEO Barry Elson announced today that he will step down from his post on May 31.

Elson will be a consultant to Bally over the following 90 days and will continue to serve as a director, the company announced. Interim Chairman Don Kornstein will assume the new role of Chief Restructuring Officer while Bally searches for a permanent CEO.

Elson, the former acting chief executive officer and director of Telewest Global, and Kornstein, the founder and managing partner of Alpine Advisors, joined the Bally board in January 2006. They took over their interim posts after Paul Toback, Bally’s chairman and CEO, was ousted on Aug. 11, 2006.

Bally announced in March that it might file for bankruptcy if it is unable to restructure its debt, which at the time was $827 million. On Wednesday, Bally’s stock was formally delisted from the New York Stock Exchange. The stock closed today at $0.65 on the Pink Sheets exchange.

The Daily Herald, a suburban newspaper in Chicago, where Bally is based, reported today that two potential buyers of Bally are New York-based Town Sports International Holdings Inc., and Eden Prairie, MN-based Life Time Fitness Inc. Prudential Equity Group LLC analyst Joel H. Simkins says that Bally is attractive to both thriving publicly-traded companies, the newspaper reported.