Create breathing space to explore rescue, restructuring or a business sale, with clear advice from Molly Monks F.I.P.A., Licensed Insolvency Practitioner.
Free initial advice · No obligation · Nationwide support
Administration is a formal insolvency procedure in which a licensed insolvency practitioner takes control of a company’s affairs, business and assets. It provides a framework for assessing whether the company can be rescued or whether another course would achieve a better result for creditors.
A statutory moratorium restricts most creditor enforcement and legal proceedings against the company while it is in administration. This can provide breathing space to explore restructuring, continued trading or a sale of the business and its assets.
Administration does not guarantee that the company will survive. A business may continue under a new owner while the original company later enters liquidation or is dissolved. The right approach depends on the finances, available funding and achievable outcome.
The law sets out three objectives in a defined order. A business sale may be a way of achieving an objective; it is not a separate statutory objective.
The primary objective is to rescue the company as a going concern, so that the company itself can continue.
If rescue is not reasonably practicable, or this would produce a better result, the administrator seeks a better outcome for creditors as a whole than an immediate liquidation would provide.
If neither of the first two objectives is reasonably practicable, assets may be realised to pay one or more secured or preferential creditors, without unnecessarily harming creditors as a whole.
We look at the whole position before recommending a procedure, including cash flow, asset values, creditor pressure and the prospects for preserving value.
There must be a realistic basis for using administration, whether through company rescue, a managed sale or another outcome that meets the statutory objectives.
Continued trading needs funding for wages, supplies and other costs. We assess what is available, what creditors are owed and whether a plan can be delivered.
The company’s legal position, existing creditor action and secured lenders’ rights influence how an administrator can be appointed and the steps required.
Taking advice does not itself create a moratorium. Speak to us urgently about any legal proceedings or enforcement deadlines.
Molly explains how administration works, the protection it can provide and why it may be considered when there is business value to preserve.
We explain the practical steps and what each stage means for your company.
We listen to your concerns, review immediate pressures and explain the information needed to assess the company.
We assess cash flow, assets, creditor claims and funding, and compare administration with other rescue or closure routes.
If administration is appropriate, we establish the lawful appointment route and prepare the required notices and documents.
The administrator manages the company’s affairs and assets. The administration moratorium restricts most creditor action.
The administrator sets out proposals for creditors and carries out the appropriate strategy, which may involve trading, restructuring or a business sale.
Creditors receive updates. The administration ends through the appropriate route, which may include a CVA, liquidation or dissolution.
A pre-pack is a sale of a company’s business or assets that is negotiated before the administrator is appointed and completed on, or shortly after, appointment. It is an approach within administration, rather than a separate insolvency procedure.
Where suitable, a prepared sale can reduce disruption and preserve value that could otherwise be lost. It may help the business continue under new ownership, although the original company and its debts still need to be dealt with through the insolvency process.
A pre-pack is not right for every business. The sale must be properly assessed, valued and documented, with creditor interests and the relevant legal and professional requirements considered.
Read our introduction to pre-packs →The administrator takes control. You must provide records and cooperate, and may only exercise management powers with the administrator’s consent. Director conduct is reviewed, and guarantees or other personal exposure need separate advice.
The business may continue trading, but redundancies can occur. Where a business is sold, TUPE may affect employment transfers and claims. Statutory payments depend on eligibility; employees do not automatically become entitled to redundancy pay on appointment.
The administrator manages claims, reports on progress and distributes available funds in accordance with the applicable priorities. A creditor’s return depends on the assets, costs and legal ranking of its claim.
Molly is Parker Walsh’s founder and in-house Licensed Insolvency Practitioner. With more than 20 years’ experience, she helps directors understand their position and the options available.
Our small, friendly team provides practical support with financial assessments, appointment preparations, creditor communication and the administration process. We explain the implications for the company, its directors and employees so that you know what to expect.
Based in Bramhall, we support businesses across the UK, with consultations by telephone, video or in person.
Administration costs depend on the company’s size, the complexity of its finances, the work required and whether trading or a business sale is involved. There is no single fee that is suitable for every case.
We will explain the likely professional fees, expenses and funding requirements before you decide on the next steps. Administration costs are generally met from company funds or asset realisations, subject to the applicable approval and priority rules.
Your initial consultation is free and confidential. It gives us a starting point for assessing suitability and discussing likely costs.
We will consider whether another route could address the company’s difficulties more appropriately.
A viable company may be able to agree a formal repayment plan while directors remain in day-to-day control. A CVA needs creditor approval and sustainable contributions.
Understand CVAs →Operational changes, refinancing or negotiations with creditors may support recovery where a formal administration is not needed.
Explore restructuring →Where tax arrears are the main difficulty and repayment is affordable, an arrangement with HMRC may help. It does not deal with debts to other creditors.
Explore Time to Pay →Where the company is insolvent and administration would not achieve an appropriate purpose, a CVL may provide a controlled route to closure.
Understand CVL →Use our practical articles and related free guides to understand rescue options, business sales and the implications for your company.
Understand the different aims of administration and liquidation and the factors directors should consider.
Read the article →Compare CVAs, administration and informal standstills, including viability, funding and creditor support.
Read the article →An introduction to pre-arranged sales and how administration and liquidation approaches differ.
Read the article →Molly explains administration, moratorium protection and when it may be an alternative to liquidation.
Read the article →Explore Time to Pay, CVAs and pre-pack options when tax arrears put pressure on the company.
Read the article →Recognise cash-flow pressure, creditor demands and other signs that it is time to seek advice.
Read the article →Understand the employee considerations when a business may be sold or transferred, and when specialist employment law advice is needed.
View the free guide →Our director’s guide explains urgent steps, Court hearings and banking risks. Use it alongside prompt advice about your company’s options.
View the free guide →Our CVL guide explains the process and issues directors should consider where an orderly company closure may be more appropriate.
View the free guide →If your question is not covered here, call us on 0161 546 8143. Initial advice is free and confidential.
Administration is used to pursue statutory rescue or creditor outcomes and may involve continued trading or a sale. Liquidation winds up the company’s affairs. Administration can be followed by liquidation, so the processes are sometimes stages in the same case.
Possibly. The administrator decides whether trading supports the purpose of the administration and can be funded. A business sale may preserve operations under a new owner, but neither trading nor company rescue is guaranteed.
No. Control passes to the administrator. Directors must cooperate and supply information, and cannot exercise management powers without the administrator’s consent.
The statutory moratorium restricts most enforcement and legal proceedings against the company. Certain actions can proceed with the administrator’s consent or Court permission. It does not automatically prevent creditors pursuing personal guarantees.
Administration normally ends automatically after 12 months unless properly extended. It may end sooner, and the time needed for a sale or restructuring can differ from the time needed to complete the administration.
Depending on the circumstances, appointment may be made by the company or its directors, by a qualifying floating charge holder, or through the Court. Existing proceedings and secured lender rights can affect which route is available.
A pre-pack is a sale negotiated before the appointment and completed on, or shortly after, appointment. It is one way a business sale may be carried out within administration, with valuation, reporting and any applicable connected-party safeguards.
No. Some businesses continue trading or transfer to a purchaser. TUPE, employment rights and any redundancy claims depend on the circumstances. Independent employment law advice may be needed.
The initial consultation is confidential. Once an administrator is appointed, the appointment is public and creditors are notified.
Not automatically. Administration addresses the company’s affairs. Rights under guarantees, director loan accounts and other potential personal liabilities need separate review.
Talk to Molly about the pressures facing your business and whether administration could be appropriate. Your initial conversation is free, confidential and without obligation.
