Administrators are assessing offers for Nikolaos Solomos’ debt-ridden Derrimut 24:7 Gym chain, with any buyer expected to cover all staff superannuation entitlements.
HM Advisory, appointed after Solomos placed three core companies into administration on November 5, has since taken control of six additional Derrimut businesses.
According to The Age, a source familiar with the process said only bids guaranteeing super payments would be considered.
The collapse marks a sharp reversal for Solomos, who founded Derrimut in 2010 and last year boasted the business had loads of members and plans for 300 gyms by 2030.
Despite 25 sites across Victoria and South Australia, Derrimut was overwhelmed by debts to the ATO, staff, landlords and suppliers, prompting lender BizCap to appoint receivers over all assets the day after the administration.
Gyms continue trading, though at least two are expected to close.
An investigation in September revealed the business struggled to meet basic expenses while also funding luxury cars for staff and significant allowances for Solomos and his family.
Derrimut is believed to owe more than $30 million, including an estimated $15.4 million in tax debts, unpaid superannuation and penalties.
Billionaire Adrian Portelli withdrew earlier interest over concerns about the company’s management but said after the collapse that he had made an offer.
“However, now that it’s gone into administration, I wouldn’t be opposed to buying the whole f—ing lot,” he said.
A second creditors’ meeting is set for next week.
Source: The Age.
