Iconic slimming company Jenny Craig is going out of business in Australia after its administrators failed to find a buyer.
Voluntary trustees Vaughan Strawbridge, Kate Warwick and Joseph Hansell of FTI Consulting have recommended that the company be liquidated.
Administrators had attempted to sell the company with the “intention of preserving as many jobs as possible and limiting losses to creditors,” according to a statement from FTI.
Despite a bidding and sale process that resulted in 15 interested parties and four non-binding indicative offers, no buyers could be found for the company.
“Despite all efforts, the trustees were unable to find a buyer for the Australian and New Zealand company’s physical stores and employees,” the statement said.
“The trustees today advised all employees in Australia and New Zealand that a sale of the business, with the stores continuing to trade and staff remaining employed, has not been feasible.”
Trading is immediately suspended and employees are fired, something the administrators describe as “an unfortunate outcome”.
Creditors are not expected to be repaid after the company goes into liquidation, but employees will receive their entitlements through assets sold or the government’s Fair Entitlements Guarantee.
In May, Jenny Craig’s US and Canadian offices were closed when the company filed for bankruptcy.
The online services the company provides will be sold to Eucalyptus, a healthcare technology company, which will continue to offer customers online weight loss solutions.
Eucalyptus currently advertises at least 48 job openings on its website, including health coaches, mental health nurses, nutritionists, and weight consultation physicians.
The company describes itself as a “diversified group of software engineers, creatives and operations experts who “care deeply about the patient experience and simplifying the narrow and complex world of healthcare”.
Eucalyptus’ website prominently states that it is “one of Australia’s fastest growing start-ups”.
Australians were quick to take to social media to comment on the demise of the once iconic company, with one commenter describing it as a “massive loss”.
“I feel sorry for all the people who recently paid for meals and are now becoming creditors,” said another person.
Others were quick to say that Jenny Craig’s business model was outdated, contributing to its downturn.
“As a business model, it’s probably fine to make money through quick turnover, because while people do get results, the weight loss is rarely sustainable. As a health model it’s no good, in fact it probably does more harm than anything else. It’s time for it to be gone,” one of them said.
More to come.