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Corporate Recovery Farleys Solicitors LLP

Pre-Pack Administrations

Solicitor for Pre-Pack Administrations

What is a pre-pack administration?

A pre-pack administration is an insolvency procedure wherein a company’s business and / or assets are sold immediately when the company is put into administration by the administrator, under a sale that was arranged before the administrator was appointed.

When would a pre-pack administration be appropriate?

Pre-pack administrations can be appropriate when the company is struggling and may not be able to continue to trade. The company needs to have a viable business, that someone is prepared to fund.

Benefits

Downsides

Considerations for Administrators

Under the Statement of Insolvency Practice 16, administrators should comply with certain guidelines. For example, an administrator should disclose certain information to the creditors within seven days of the proposed pre-pack sale.

Considerations for Directors

In order to avoid later being found liable for wrongful trading, directors need to make sure their actions are for the benefit of the creditors when a company is insolvent. This is the case when considering a pre-pack administration. To ensure that they do so, it is advisable to seek independent legal advice.

Considerations for Creditors

If a creditor is unhappy with a pre-pack administration, they may be able to challenge it in the following ways:

Legal Advice on Pre-Pack Administrations

If you are a director considering a pre-pack administration, an administrator conducting one or a creditor who is unhappy with one, Farleys have the experience and expertise to help you through the process.

contact a corporate recovery solicitor

Please get in touch with Farleys’  insolvency team on
0333 331 4224 to discuss your optionms

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