A popular Australian gym chain has collapsed after it was embroiled in a legal battle with three of its franchisees.
Ultimate Franchising Group Pty Ltd, UFC Gym Prospect Pty Ltd and Ultimate Franchising Group Properties Pty Ltd — the three parent companies behind UFC Gym Australia — went into voluntary administration on May 23.
The three companies held the master franchise agreement for UFC Gym Australia.
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UFC Gym specialises in mixed martial arts training and has several centres across Australia, according to its website, with more set to open soon.
At the start of last month, UFC Gym Australia and its directors were ordered to pay three franchisees $5.2 million as revealed by court documents, after allegations of “misleading conduct”.
UFC Balcatta in Perth and UFC Castle Hill and Blacktown in Sydney were the three gyms engaged in the legal battle.
UFC Balcatta, which has now been rebranded as Rival Gym, wrote on Facebook that the past several years had been “challenging, to say the least”.
“We’ve faced hardships, hurdles, and obstacles, but through it all, our resolve to deliver a superior experience for our members has only strengthened,” the post read.
“On a brighter note, as RIVAL GYM, we will not be restricted by franchise rules and can now take the reins in shaping the kind of fitness environment we’ve always wanted to provide for you.”
The gym was awarded a payout of $1,789,848.
UFC Castle Hill has also rebranded as Rival Gym, while UFC Blacktown has shut down entirely.
“It has been a journey and we have made some great memories. The journey had its ups and downs, but we certainly had a blast through it all,” the Blacktown centre wrote on social media.
UFC Blacktown was awarded $1,955,996 while Castle Hill was allocated $1,485,643.
It is unclear how the company’s insolvency will impact the franchisees’ payments.
Rajiv Goyal and Christopher Johnson from Wexted Advisors have been appointed administrators.
Wexted and UFC Gym Australia have been contacted for comment.
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