The fitness empire behind Melbourne’s prominent gym chain Derrimut 24:7 has entered voluntary administration following the collapse of a proposed rescue agreement with billionaire investor Adrian Portelli.
Founder Nick Solomos informed staff via internal memo that the move was a “proactive step” to restructure the business, protect employment and preserve the chain’s future — despite debts believed to exceed A$30 million.
Operating under administrator Stephen Dixon of HM Advisory, the chain will keep its 26 gyms open for the time being while the assessment proceeds.
Key pressures pushing the company into administration include:
- A substantial tax-office claim by the Australian Taxation Office (ATO) for more than A$12 million, moving toward liquidation action.
- Rental debts leading to branch closures — several sites in Adelaide and regional Victoria shut their doors abruptly.
- The withdrawal of Portelli, who cited irreconcilable differences in rescue negotiations.
In a dramatic collapse of its turnaround strategy, the chain’s heavy expansion and mounting liabilities appear to have outpaced its financial management. Reports previously revealed that the business had fallen behind on tax, superannuation, and supplier obligations, and company funds were used to support personal expenses.
The decision to place Derrimut into administration draws attention to both the vulnerabilities in the Australian gym industry and the risks of rapid expansion without sufficient financial controls.
