Body Catalyst collapse: Creditors owed $8.5m vote on proposal

Creditors have decided that what remains of a limping beauty chain will remain in business as they seek to recover a percentage of their debts.

Creditors have decided that what remains of a limping beauty chain will remain in business as they seek to recover a percentage of their debts.

Last month, news.com.au reported that Body Catalyst, a non-surgical cosmetic medicine chain with clinics across NSW, Victoria and Queensland, had gone into voluntary administration.

Then a week ago, this publication revealed that 26 clinics had collapsed into liquidation, with just 16 remaining at the embattled group of companies.

On Tuesday afternoon, creditors held the fate of Body Catalyst in the palm of their hand, deciding whether the remaining stores should continue operating or whether they too should shut down permanently.

They voted on a Deed of Company Arrangement (DOCA), which is where Body Catalyst founder and former CEO Samantha Barakat Light offered to pay a certain amount of money to take the 16 stores out of external administration.

Under the proposed DOCA, which has now been accepted, staff will receive 100c for every dollar owed while unsecured creditors will get 3.2c.

Body Catalyst owed $5.3 million to unsecured creditors and a further $3.2 million owed to secured creditors, the administrators told news.com.au. That comes in at a total of $8.5 million.

Body Catalyst had an important meeting on Tuesday afternoon where creditors voted to keep the chain alive.

The appointed administrators, Alan Walker and Glenn Livingstone of insolvency firm WLP Restructuring, are now longer in charge of the company.

Control has reverted back to Samantha Barakat Light.

WLP Restructuring previously said they had brought forward the meeting to liquidate the 26 stores so that creditors could focus on those remaining.

“While this process led to the unfortunate but necessary closure of clinics and related staff redundancies, the vote today creates a viable path forward for the Group,” Mr Walker said in a statement provided to news.com.au.

There are now only 16 stores left in business across NSW, Queensland and Victoria.

Over in NSW, there still exists a Body Catalyst clinic in Armadale, Bondi and Camden and also in Mosman, Mount Gravatt and Williamstown over in Queensland.

Victoria has the highest concentration of Body Catalyst stores, in Charlestown, Chermside, Doncaster, Geelong, Green Hills, Hampton, Ivanhoe, Melbourne Central, Moonee Ponds, Mornington.

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Samantha Barakat is the founder of Body Catalyst.

The remaining 85 staff have also retained their jobs due to creditors voting on the DOCA.

News.com.au previously reported that mass sackings took place in the months leading up to the company’s administration appointment.

In a post on LinkedIn, Ms Barakat Light celebrated the news by announcing “WE DID IT”.

“It has been heartbreaking to have clinics close and even tougher for team members whose employment has been affected or uncertain during this process,” she added.

“That’s why it’s important to me that the DoCA allows all employee entitlements to be paid in full.”

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Originally published as Body Catalyst collapse: Creditors owed $8.5m vote on proposal