Appointing an administrator
Suitable for: insolvent companies, those facing serious debt recovery or threats of legal action.
Appointing an administrator if your company is in financial difficulty will permit the reorganisation of the company’s affairs or the realisation of its assets for the benefit of creditors. Our experienced insolvency practitioners can be appointed as your administrator and to take control of the company’s affairs.
The aim of an administration is to rescue your company so that it can continue trading. If you must cease trading, your administrator must reach a solution which has a better outcome than if the company went into liquidation. Otherwise, your company’s property will be realised and the assets distributed to the company’s secured or preferential creditors.
If the administration results in your company being rescued, control will be given back to the company’s director. However, if the company cannot be rescued, the net proceeds of the company’s assets will be distributed to the company’s creditors.
– An automatic moratorium means during the administration no creditor can take any recovery action against the company without the court or administrator’s consent.
– The administrator guarantees payment for employees and any transactions undertaken by the company
– Often used as a way to rescue the business
– Directors may be able to regain control of the business after the administration
– The administrator will approve all operational decisions and the director(s) will lose control of the company
– By law, the company must advertise it is under administration when trading
– Jobs could be put at risk if it is decided that some or all of the business should be closed or sold