Administrators called in after Topnotch fails fitness test
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Your support makes all the difference.The health and fitness club minnow Topnotch became the ailing sector's latest victim yesterday, after it collapsed into administration.
The move ended the company's struggle to persuade its bankers, NatWest, to grant it a lifeline almost one year after it first breached its banking covenants.
It follows the recent disappearance from the quoted arena of a string of health clubs, including Holmes Place and Fitness First.
Topnotch, which suspended trading in its AIM-listed shares last month, was forced to appoint administrators after failing to get three landlords to release it from contracts on three sites that it could not afford to develop.
Matthew Harris, the chief executive, said: "We tried to cut a deal with the landlords to walk away from the leases but we couldn't agree on one." He blamed part of the company's problems on "poor clubs" that it acquired from other operators.
The group, which has debts of £3.3m, has sold off more than half its estate during the past 11 months to raise enough cash to meet the terms of a rescue-funding package from its bankers. It has sold 11 sites so far this year, leaving it with just nine clubs across the Midlands and the South.
Mike Oldman, a partner at RSM Robson Rhodes, the administrators, said he hoped to secure an offer for the group "on a going concern basis". Mr Oldman added: "I am confident that the quality of the portfolio will secure a significant amount of interest in what has been an active market in recent months."
Mr Oldman ruled out any club closures and said that the group would "retain member services at all clubs in the short term".
However, one site in Waterloo, London, part of the development beneath the railway bridge, is expected to shut next month.
Topnotch made losses of £5.3m in the six months to October 2002, the last time it reported its financial results.
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