If your business is failing but can be sold as a going concern at a premium or can benefit from continuing to trade to complete contracts and work in progress an administration order may be appropriate.
Administration is a legal process designed to help struggling but potentially viable companies by protecting a business from its creditors whilst restructuring takes place. If your company is in debt and under pressure from creditors or perhaps is being threatened with legal action such as a winding up petition, seeking the protection of administration will prevent any further legal action. Ideally companies in administration can continue to trade through its difficulties and come out the other side as a going concern but if that is not possible it can be used to achieve 'a better realisation of assets' or to facilitate a payment to preferential and secured creditors.
Administrators' primary purpose is to get an ailing company back on its feet. Our team has experience of administrations of many different industries and business sectors and where possible will work with you and your existing management team to achieve the best possible outcome.
When might administration be appropriate? For instance:
These days directors can choose their own administrator to work with rather than waiting for the bank or another creditor to impose one. Contact us now, in confidence, to find out if administration may be the appropriate route for your company.
Sometimes there is a need to sell the business and/or assets arising out of an administration and you can find out more about businesses for sale both from McTear Williams & Wood and other insolvency practitioners at the UK’s leading insolvent business and asset website www.IP-BID.com – this is the UK’s online market place for buyers and sellers of businesses in distress.
Marketing a business is an important element in ensuring that the best available consideration is obtained for it in the interests of creditors and will be a key factor in providing reassurance to creditors. Any marketing should conform to the following:
Broadcast - the business should be marketed as widely as possible proportionate to the nature and size of the business - the purpose of the marketing is to make the business's availability to the widest group of potential purchasers in the time available, using whatever media or other sources are likely to achieve this outcome.
Justify the marketing strategy - the statement to creditors should not simply be a list of what marketing has been undertaken. It should explain the reasons underpinning the marketing and media strategy used.
Independence - where the business has been marketed by the company prior to the insolvency practitioner being instructed this should not be used as a justification in itself to avoid further marketing. The administrator should be satisfied as to the adequacy and independence of the marketing undertaken.
Publicise rather than simply publish - marketing should have been undertaken for an appropriate length of time to satisfy the administrator that the best available outcome for creditors as a whole in all the circumstances has been achieved. Creditors should be informed of the reason for the length of time settled upon.
Connectivity - include online communication alongside other media by default. The internet offers one of the widest populations of any medium. If the business is not marketed via the internet this should be justified.
Comply or explain - particularly with sales to connected parties where the level of interest is at its highest, the administrator needs to explain how the marketing strategy has achieved the best available outcome for creditors as a whole in all circumstances.