Business Sales From Administration
At Blake-Turner we regularly advise and act on business sales from administrations. These are often called “pre-pack” sales where the business of a company is marketed discreetly but effectively before and after it enters administration, and then sold as a going concern. That way, the administrator recovers money for creditors and the business survives. This also often serves to protect employees’ jobs because those jobs most often transfer with the business.
Pre-pack sales from administrations are often maligned in the press because they are often to connected parties such as the existing shareholders or directors. However, in our experience this is not the correct analysis. The saving of any business is surely to be prioritised, particularly where the contracts of employment are preserved for employees, and creditors receive a greater compensation than they otherwise would have done. It is simply often the case that businesses rely on personal relationships and a pre-pack sale can preserve those for the benefit of all parties.
There are other routes and procedures that an insolvent company can take. These include liquidation and creditors’ voluntary arrangements (CVA). Please click on the foregoing links for information about those, or the following link for further information about administration.
If you would like to speak to one of the team at Blake-Turner about administration, or indeed any company insolvencies, cash flow difficulties or shareholder disputes, please contact Paul Cooper on +44 (0) 7967 014788 and/or firstname.lastname@example.org.