Jon Adgemis hits back at administrator claims over $9m transactions

Sydney pub baron Jon Adgemis says administrator’s claims that he pulled $9m out of his troubled hospitality business wrongly classify transactions aimed at propping up the group.

Sydney pub baron Jon Adgemis denies misusing funds from his business. Picture: NCA NewsWire / David Swift

Sydney pub baron Jon Adgemis says administrator’s claims that he pulled $9m out of his troubled hospitality business wrongly classify transactions aimed at propping up the group.

In response to an administrator’s report published by BDO Business Restructuring national leader Duncan Clubb, Mr Adgemis warned he did not derive “any personal benefit from those transactions”.

This comes as BDO administrators identified the $9m in funds withdrawn from Mr Adgemis’s pub business “in the year prior to appointment”, warning the transfers “may constitute uncommercial transactions”.

BDO administrators also allege Mr Adgemis extracted $475,000 in funds from the pub group through his role as director since November 6, 2023.

Administrators have advised creditors to liquidate Mr Adgemis’s businesses, several of which were seized after lenders to a string of his pubs took over the assets amid a dispute over a $100m debt stack. This comes despite Mr Adgemis proposing a deed of company arrangement for the five pubs, which would see some creditors fully paid.

The former KPMG deal-maker has proposed contributing $7.7m to the administration of the group of companies through an upfront $1m cash payment plus a further $6.7m through a convertible note due by September next year. Administrators had said the group of companies should be wound up given the lack of scrutiny applied to Mr Adgemis’s proposal.

But on Thursday Mr Adgemis’s spokesman said a supplementary report to creditors was now expected “to ensure the administrators assist creditors to make an informed decision”.

“We anticipate a supplementary report will need to be issued setting out the certainty of our deed proposal as against the uncertainty and losses associated with a liquidation,” the spokesman said.

He said the $9m in transactions identified by BDO actually constituted a “subset of transactions in respect of intercompany transfers between the property group”. “It does not relate to Mr Adgemis personally and nor has he derived any personal benefit from those transactions,” Mr Adgemis’s spokesman said.

“The transactions were directed to operating companies to cover expenses and legitimate business costs.”

Mr Adgemis’s spokesman said the transactions were done at the direction of, and funded by, lenders to the property companies and Public Lifestyle Management, the employment entity of the pub group.

Mr Adgemis’s spokesman said the end position of the transactions instead left Mr Adgemis’s company JAGA a “net creditor” to the companies in administration. This could see the companies owed up to $13m by the companies in administration.

Mr Adgemis’s companies owe secured creditors $174.7m, while unsecured creditors are owed a further $34.2m. The BDO administrators warned Mr Adgemis’s companies may have traded while insolvent between 2021 and 2023, but noted the group returned to solvency in 2024.

However, they warned that despite this Mr Adgemis could face a $24m insolvent trading claim, which could see the pub baron lumped with the debts and possibly banned from running companies in future.

PLM as well two other entities were placed into administration in mid-September after Muzinich, an American private lender, ended Mr Adgemis’s control of the five venues in Sydney.

FTI Consulting was appointed receivers over the property assets, covering The Strand Hotel in Darlinghurst, Camelia Grove Hotel in Alexandria, Norfolk Hotel in Redfern, Oxford House in Darlinghurst, and a site under development – the Exchange Hotel in Balmain.

However, two other groups of pubs and hotels controlled by Mr Adgemis remain outside of administration, with no dispute with lenders on those assets.

Prior to a March refinancing, these other 11 pubs and hotels were operating under PLM.