Prime’s Australian Distributor Collapses Into Administration With £4.8M Debt

Congo Brands Australia, the company behind Logan Paul and KSI’s Prime energy drink in Australia, has entered voluntary administration after a dramatic financial collapse. Sales plummeted 53 percent to AU$14.5 million in the 2024 financial year from AU$31 million the year before. The company now carries AU$7.92 million in debt and holds just AU$84,855 in cash. Administrator Alice Fay Ruhe was appointed on Tuesday, with the first creditors meeting scheduled for July 18.

How the viral drink lost momentum

Prime launched in Australia in 2022 and became a sensation among schoolchildren, driven by the celebrity status of co-founders Logan Paul and KSI. The colourful energy and hydration drinks flew off shelves. But demand dried up fast. Between 2023 and 2024, Congo Brands Australia slashed inventory from AU$28.9 million to AU$1.7 million, recording a AU$4.57 million write-down of stock. The company recorded a net loss of AU$1.42 million in the 2024 financial year.

Why the Australian arm collapsed

Packaging company Orora Group filed a Federal Court application in June seeking to wind up Congo Brands Australia, triggering the voluntary administration. The US-based parent company, Congo’s global holding business, has committed to supporting the Australian operation during the administration process. However, the local distributor had become unsustainable on its own, unable to shift inventory or return to profitability.

The regulatory headwinds Prime faced

Prime Energy contains 200mg of caffeine per 335ml can and is banned by Food Standards Australia New Zealand because the maximum allowed is 32mg per 100ml. The drink carries a warning it is not suitable for people under 18. In 2023, school principals across Australia banned Prime Hydration from campuses over health concerns. These restrictions limited the brand’s addressable market and contributed to the sales collapse.

What happens next

The global Prime brand remains operational outside Australia. The first meeting of creditors is scheduled for July 18, where the administrator will outline options for the business. Creditors owed AU$7.92 million face significant losses given the company holds only AU$84,855 in liquid assets. The outcome will likely determine whether Prime’s Australian operations continue or are wound down entirely.

Final Thoughts

Prime’s Australian collapse shows how quickly viral consumer brands can falter when regulatory headwinds mount and hype fades. With the distributor now in administration and the parent company providing only financial support, investors and creditors face major losses. The global Prime brand survives, but Australia’s chapter appears closed.

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