Pre Pack Administration
This course of action will be taken when the directors do not want to put any more resource into a failing company that is basically already insolvent. The intention is for the assets of the company to be sold to a third party or associated company who are interested in purchasing them. The directors or a third party start a new company, which buys the assets of the old company, the debts and liabilities stay in the old company. The rationale behind this is that the pre pack gives the best return for the creditors because speed is necessary to preserve the value of the company and its assets. It further gives the business its best chance of succeeding in the future. Also keeping people in work, the new company carries on using the existing suppliers and potential future contracts could be secured. This procedure allows for the goodwill and reputation to remain in place, jobs to be saved and contracts and work going forward to be maintained and completed.
If you have any questions or require further information about the services we offer, please contact us on 01302 342875.