Jon Adgemis, the loss-making olive oil company, and the $625,000 loan
An Italian olive oil business half-owned by Jon Adgemis made no money over seven years and reported production valued at just €1, despite being lent hundreds of thousands of dollars by the bankrupt dealmaker.
Olivetta Dreams, established in 2017 and based in a small town near Monaco, was lent more than $625,000 from Adgemis between October 2016 and April 2019 for the “purchase of property and funding of repairs”, according to affidavits filed by the Australian Taxation Office.
But accounts filed by Olivetta Dreams show the company’s assets peaked at just €334,729 ($593,072) in 2019 before being largely wiped out by 2023. It is unclear how the loans from Adgemis were accounted for in the Italian company’s filings, which showed debts falling between 2017 and 2020.
The businessman was once a high-profile KPMG dealmaker before launching his own hotels and pubs empire, known as Public Hospitality, in 2021. Adgemis eventually built a portfolio of 22 venues before enormous debts and questionable valuations led to the collapse of the business.
Last week, amid a pile of $1.8 billion in debts, Adgemis was declared bankrupt. He owes money to hundreds of employees, the ATO, Monaco-based businessman Richard Gazal and Deutsche Bank, among others.
Adgemis’ personal bankruptcy is among the largest in Australian history, and is significantly larger than that of Christopher Skase’s in 1991. In nominal terms, it is equal to Alan Bond when he went bankrupt in 1992.
Documents filed with the Federal Court show ATO officials had flagged their concerns with money transferred to Olivetta Dreams as far back as 2021, with 11 transactions to Italy and Jersey, a tax haven in the English Channel.
Olivetta Dreams made a loss every year it was in business and was registered to a consultant’s office in Bordighera, in Italy’s north-west.
The company’s accounts for the 12 months to the end of December 2017, the first it filed, showed total debts of €352,204 and assets of €294,169. Accounts for the following year show debts of €291,453 and assets of €299,561.
In 2019, debts fell to €246,814 and assets rose to €334,729.
According to a spreadsheet supplied by Adgemis’ accountants at PKF to the ATO, the businessman had begun transferring money to Olivetta Dreams in October 2016, starting with a $26,758 payment. A similar payment was made in January 2017, and regular payments flowed over the year. In 2018, according to the spreadsheet, Adgemis and Adgemis Holdings transferred $77,345 to Olivetta Dreams, with a final transfer of $31,726 in April 2019.
The transfers were described as loans for property purchases and repairs.
According to the documents filed by the ATO, tax officials have been particularly concerned that the businessman’s “complex” affairs mean assets and other debts may not have been properly disclosed. Adgemis, in his previous role at KPMG, helped clients with overseas business structures.
Emails filed with the court separately suggest the businessman has been the subject of a Departure Prohibition Order, which prevents him from leaving the country. The ATO said: “We acknowledge the Federal Court’s decision that Mr Jon Angelo George Adgemis be made a bankrupt by way of a sequestration order and that his debtor’s petition be rejected. The decision noted the need for proper investigation of Mr Adgemis’ affairs.”
A spokesman for Adgemis declined to respond to questions about Olivetta Dreams, citing the legal process and bankruptcy.
“We intend to cooperate fully with that process. Mr Adgemis has consented to the trustee recommended by the ATO so that a proper and transparent investigation can take place. We are respectful of the trustee’s role and remain committed to ensuring all matters are resolved openly and in accordance with due process,” his spokesman said in an emailed statement.
In an affidavit, ATO strategy recovery and insolvency officer Cody Hutton said he was concerned that there had not been proper investigations of Adgemis personal property, such as artwork and jewellery, his interests in 219 Australian companies where he has been a director or shareholder, his interests in foreign companies, such as Olivetta, $2.4 million in payments from his bank accounts with the description of “yacht”, nearly $700,000 paid to his former partner, and the transfer of luxury cars to an associate.
The $1.8 billion debt pile that forced Adgemis into bankruptcy is largely associated with $1.4 billion in personal guarantees provided on loans for Public Hospitality. The figure does not account for debts owed by some of his companies, and documents seen by The Australian Financial Review show potential tax debts of just under $300 million across 27 entities.
The ATO has been investigating Adgemis and Public Hospitality for well over a year. The Financial Review revealed in May last year that ATO officials had raided his home and office, the same month that it began pursuing some of Adgemis’ entities for failure to pay millions of dollars in tax.
Hutton’s affidavit makes reference to ATO audits of 36 of Adgemis companies, and alleges there was a sham arrangement at one of the entities where contracts and invoices were created to support GST claims made by other businesses within the Public Hospitality empire. Allegations of improper GST claims are being investigated by insolvency firm BRI Ferrier and the ATO. Adgemis has repeatedly denied any tax fraud.
Adgemis had attempted to stave off bankruptcy in June, offering creditors 0.15¢ in the dollar. However, a vote on the deal was called off amid concerns that he had not disclosed all his assets. The ATO, which claimed it is owed $162 million, also intervened and said Adgemis was leading an “extravagant lifestyle” unbefitting someone facing possible bankruptcy.
