Pre-Pack Administration

A ‘Pre-Pack’ Administration is a procedure where an Administrator is appointed to enable a company to sell its assets to a pre-arranged buyer. The Administrator manages the sale after it has been agreed.

It is only applicable where

  • The normal Administration process is not possible or will be more damaging to the business
  • Continuing to trade under traditional Administration cannot be funded
  • It represents a better outcome than traditional Administration or Liquidation

Benefits

  • No break in trade and no adverse impact
  • Maximises value to stakeholders as a going concern
  • Enables viable businesses to progress unhindered
  • Retains employment
  • Reduced costs to the Administrator compared to a sale in Administration

Considerations

  • Requires a restricted marketing campaign in advance
  • Must demonstrate that it is in the best interests of stakeholders
  • May require approval of the official Pre-Pack Pool
  • Permission is required for the re-use of trading names if the original company has been liquidated
  • Director duties and responsibilities still apply