A Pre-Packaged Administration or ‘pre-pack’ is where a company is put into administration and its business and/or assets are immediately sold under a sale agreement which is arranged before an administrator is appointed. A Pre-Packaged Administration can be used when a company is failing due to serious financial difficulties such as historic tax and trade debts, unfavourable lease agreements or problem factoring agreements.

If you believe that without its liabilities your company has an underlying value then a pre-pack may be for you.

Pre Pack Benefits

  • Pre-pack administration can result in a quick and relatively smooth transfer of a business.
  • Pre-packs can protect the goodwill of the company as they have a minimal impact on customer confidence that any insolvency proceedings inevitably cause.
  • Pre-packs can save more jobs than in a normal administration.
  • Because the process is relatively quick compared to a normal administration, the costs of the administration process may be reduced, which may result in a better return for creditors.

Pre-pack Administration Case Studies

Company Directors approached Focus Insolvency Group to look at the company position following creditor pressure, with debts in excess of £600,000.

After analysing the trading position it was clear that a CVA wasn’t viable as the company was only just breaking even.

Accordingly, Focus Insolvency Group arranged for independent Surveyors to provide a valuation of the company assets on a going concern and break up basis {by Auction}. The directors expressed an interest in buying the company assets as they fancied giving the business another go with smaller premises and a smaller workforce.

The directors were very worried about the recent bad press concerning pre-packaged administrations however Focus Insolvency Group have a wealth of experience in handling such cases and the main route to a successful pre-pack is to get professional advice from the start from a Licensed Insolvency Practitioner.

In such cases Focus Insolvency Group’s Insolvency Practitioner will meet with the directors personally to ensure it is the best advice and make certain the process is implemented correctly right from the outset.

The company entered Administration and all the assets were sold to the former directors for an agreed price of £40,000. The remaining company debt was written off and all company liabilities including the leasehold premises and employees claims were dealt with by the Administrator and the former directors succeeded with their new company plans.

Take the next step

  • Call us direct on 01257 257030 and ask to speak to a specialist in Pre-Pack Administration. You can see our biographies here and ask for someone direct if you like.
  • We will discuss the company position: current trading, cash flow, assets, liabilities, creditor action and about your employees in clear terms you can understand.
  • We will arrange a meeting to put a suitable measure in place to protect the company and your position.
  • We will work out the best way to proceed taking all matters into consideration.
  • You will be under the guidance of Licensed Insolvency Specialists, who act as officers of the court and trusted Professionals.
  • If you just prefer some generic advice then sign up to our newsletter here and we will send you useful information and guidance on Insolvency and finance options without having to speak to anyone until you are ready.
Take the next step

Pre-pack Administration Testimonials

Great Service. I Feel like I have moved on and that’s a great peace of mind

Miss Wood

We have worked with a number of IP’s over the years, but have never found another company who offers the same level of care, support and professionalism. Focus Insolvency are always on hand to offer advice and guidance to our clients. I would recommend them wholeheartedly

Accountant, Preston

Kept me up to date with what was happening and explained everything

Mr & Mrs Foy

Focus Insolvency Group specialises in helping company directors to find solutions to their company debt problems. Call us today on 01257 257 030.

Get in touch

Anthony Fisher MIPA, FABRP and Gary Birchall MIPA, MABRP are licensed to act as Insolvency Practitioners in the UK by the Insolvency Practitioners Association. Dean Smith is licensed to act as an Insolvency Practitioner in the UK by the Institute of Chartered Accountants in England and Wales. Focus Insolvency Group is a trading style of Debtfocus Business Recovery & Insolvency Limited.

Registered in England & Wales Company Number 6831646. VAT Number: 905 2306 58.