F45 co-founder’s Reunion Training business enters administration

Liquidators are investigating Sydney-based Reunion Training, the business established by F45 co-founder and personal trainer Luke Istomin, which is reported to owe more than $2.6 million, including an estimated $363,000 to employees.

Liam Bailey, a partner at O’Brien Palmer insolvency and business advisory firm, is examining the circumstances that led to the downfall of Re:Union Operations, including whether there is any evidence of insolvent trading and breaches of director’s duties.

As reported earlier this week, Bailey told creditors he intended to report any evidence he had identified to the Australian Securities and Investments Commission.

Bailey is also investigating whether Istomin, the sole director of Re:Union Operations, engaged in “phoenix activity” by creating a new company to avoid paying creditors, including the wages and superannuation of employees.

The company provided labour hire “and other administrative services” to Reunion Training fitness centres in Sydney.

In a letter to creditors last month Bailey advised “based on my investigations to date, there is cause to believe that the director of the company may have engaged in phoenix activity.”

Bailey also told creditors he was investigating whether Reunion Training Chief Executive Simon Philis was a ‘shadow director’ given his influence over the company affairs.

Bailey said he was looking at whether there was evidence the company tried to avoid paying employee entitlements, which would leave the federal government to pick up the tab through its Fair Entitlements Guarantee safety net scheme.

He had been contacted by staff who had not been paid for 10 weeks before his appointment as liquidator.

Bailey also accused the company of sloppy bookkeeping, saying it was “evidently clear” it had failed to maintain adequate books and records as required by law.

Enjoying a high-profile as a personal trainer, Istomin is reported to have worked with celebrities including Hugh Jackman, Leonardo DiCaprio and Nicole Kidman.

He also developed F45’s regime of 45-minute high-intensity interval and circuit training classes based.

Istomin last month was quoted by media about changes at F45, the company he co-founded in 2013 with Rob Deutsch, but left in 2016 before setting up his own fitness business, Reunion Training.

The troubles affecting Istomin’s gym business come as United Workers Union, which represents health and fitness professionals, called for stronger regulation of labour hire licensing and the fitness industry.

UWU Allied Industries Director Godfrey Moase said it was a violation of an employer’s obligations to ask staff to forego wages due to cashflow problem, noting “if you can’t afford to pay wages, then you can’t afford to be in business.”

Bailey said he believed the company had been insolvent since its incorporation in February 2020, incurring continuing losses and owing more than half a million dollars in federal and state taxes.

Istomin may be liable for the company’s entire debts of $2.6 million if it is shown the company was insolvent since it was founded and if he was responsible.

Philis might also be liable if he is shown to be a shadow director.

In 2016, Istomin launched an on-demand fitness streaming service, Varlah, which he described as 'the Netflix of fitness'.

Image: Luke Istomin in 2021.