Weight loss company Jenny Craig goes under in Australia after US collapse

The Australian branch of the iconic weight loss company has gone under after administrators failed to find a buyer.

Iconic weight loss company Jenny Craig will cease to exist in Australia after its administrators failed to find a buyer.

Voluntary administrators Vaughan Strawbridge, Kate Warwick and Joseph Hansell of FTI Consulting have recommended the company be placed into liquidation.

Jenny Craig will cease to exist in Australia, just weeks after its parent US company collapsed. Picture: Facebook/ Jenny Craig

Former Spice Girl Mel B was a prominent spokesperson for the weight loss brand.

Administrators had tried to sell the business with the “intent of preserving as many jobs as possible and limiting the losses for creditors”, a statement from FTI read.

Despite a bidding and sales process resulting in 15 interested parties and four non-binding indicative offers, no buyers for the business were able to be secured.

“Despite best efforts, the Administrators were unable to find a buyer for the physical stores and employees of the Australian and New Zealand business,” the statement read.

Despite a bidding and sales process resulting in 15 interested parties and four non-binding indicative offers, no buyers were able to be secured. Picture: Facebook/ Jenny Craig

“The Administrators have today advised all of the employees in Australia New Zealand that a sale of the business, with the stores continuing to trade and staff continuing their employment, hasn’t been achievable.”

Trading will cease immediately and employees will be made redundant, something the administrators described as “an unfortunate outcome”.

It is expected that creditors will not be repaid after the company is placed into liquidation, but employees will receive their entitlements either through assets sold or the government’s Fair Entitlements Guarantee.

In May, Jenny Craig’s US and Canadian branches were closed as the company filed for bankruptcy.

The online services the business provides will be sold to Eucalyptus, a healthcare technology company, which will continue to offer online weight loss solutions to customers.

Eucalyptus is currently advertising at least 48 job openings on its website including health coaches, mental health nurses, nutritionists and general practitioners for weight consults.

The company describes itself as a “diverse group of software engineers, creatives and operations experts who “who care deeply about patient experience, and simplifying the scary and complex world of healthcare”.

Featured prominently on Eucalyptus’ website is that it is “one of Australia’s fastest-growing start-ups”.

Australians were quick to take to social media to comment on the decline of the once iconic business, with one commenter describing it as a “huge loss”.

“I feel sorry for any people who have paid up for meals recently and now become creditors,” another person said.

Others were quick to say that Jenny Craig’s business model was outdated, contributing to its decline.

“As a business model it‘s probably fine for making money via quick turnover because although people do get results the weight loss is rarely sustainable. As a health model, it’s not good, in fact it probably does more harm than anything. It’s time it was gone.,” one said.

More to come.