My company is insolvent – what are my options?

Ok, so you think there is a chance of your company going bust, broke, insolvent, bankrupt or going into liquidation (however you like to put it, it means financial crisis), you do have options and choosing the right one makes an incredible difference.

Have you considered all the various options still available to you right now? Most people don’t even know they have options when faced with the stress of their company going bust, broke, insolvent or bankrupt.

“My company is going bust” It’s more common now than for the last 40 years, but that doesn’t help you feel any better. The good news for you now is that you are reading advice from an organisation that has helped hundreds of people in financial crisis over the last twenty five years. From individuals (when an individual can’t pay their debts, goes broke, goes bust etc the official term is bankrupt) to large companies (when a company can’t pay its debts, goes broke, goes bust etc the official term is liquidation), we have helped them all. There is a solution.

If you have a company going bust or that is insolvent and you simply want to close it down correctly, then read on, the liquidation process will be right for you. We look at protecting your personal position so you don’t inadvertently get hit with your company liabilities (you’d be surprised how many directors don’t know what they automatically become liable for or have forgotten about personal guarantees and end up bankrupt). Through our contacts with insolvency practioners we can ensure it is cheap and quick and mostly painless and not even tedious or distracting. A quick review of an insolvent company ensures there are no loose ends that might surprise later on.

If you want to carry on trading but realise that this is simply too risky and too hard in the current company due to the debt levels, we will be able to do what is called a pre-pack liquidation or pre-pack voluntary administration. Speed is important and so you will find us receptive and flexible to your situation and requirements. We will fit our working schedule around yours to give you the best chance of continuing to trade with current customers, keep your best employees and suppliers with as little disruption as possible. Just because your company is bust, broke, insolvent doesn’t mean your business or assets are gone too. A little planning with the right options makes it possible to to avoid being road-kill the lights of an unfriendly liquidator who sees you as a fee (to find out why this can happen visit our information page on ‘What are Liquidators, Administrators and Receivers).

If you have a business that can continue in the same form as long as it has a bit of breathing space, we have a solution for that as well. We can protect the company with an administration appointment, while we put in place the right measures to help the company emerge fit and strong. We would engineer leaving the debt behind, whilst helping the new company emerge with a good chance of a sustainable future. This is called voluntary administration and involves doing a deal acceptable to your creditors where everyone gets less than they would have liked but more than they might have expected if you let the company go bust, broke, insolvent without any planning. HOWEVER, this exercise is fraught with danger if you don’t pre-plan and pick the right insolvency practitioner (registered liquidator or voluntary administrator – to find out why visit our information page on ‘What are Liquidators, Administrators and Receivers).
You got into business by thinking ahead. We can get you doing that again, free of the current hassles. If you have got to this point you have learnt invaluable lessons. We can help you learn even more and be able to apply them so your future is secure.

So if you think your company is going bust, broke, insolvent, do not lose hope. Contact us and let us advise you on how you can emerge from this, debt free and with a business still intact.

What is a Pre-Pack Administration?

The term pre-pack administration is now widely used in insolvency circles. It is a term used to describe a process whereby the insolvent company’s assets are sold to a third party prior to the insolvent company going into any formal insolvency process. It is most commonly used in conjunction with the voluntary administration procedure. Pre-pack Administration can save your business by writing off debt and emerging stronger as a new entity. We have specialist experience and offer practical advice.

Any deal is usually reviewed and ticked as feasible prior to the Insolvency Practitioner being appointed.

The pre-pack administration processes are used as they are acknowledged as a good way of extracting value from assets prior to an insolvency, when publicity can cause values of goodwill and such like to be lost. It keeps staff and management involved in the business, and assists continuity of trading.

The pre-pack is also used where it is unlikely that sufficient cash will be available to fund a trading administration, whilst potential buyers are sought. Pre-packs have always been available but their use has spiraled in recent years as many new types of businesses have found themselves insolvent.

If your business can be saved then you might want to take advice now to save it, whether by restructuring, writing off personal or business debts, dramatically improving cash flow by the several means available and turning the whole business around.

If it cannot be saved then you also might want to take advice to ensure the fastest possible winding up and transition to a new business model (if applicable) with the least damage to your own personal assets.

You can get a free consultation with an expert with many years experience by contacting us on 1300 366288.

What is a Pre-Pack Liquidation?

A pre-pack liquidation is a favoured way for a company that is in financial difficulties (going bust, broke, insolvent) to properly and correctly close the loss making entity, so as to protect the directors from accusations of insolvent trading, but also to enable the business and the employees to be transferred to a debt free company.

From the national-interest point of view, it is better to preserve the business and let the legal entity fail, than let a potentially profitable business founder. This is entirely the basis for the basis of the pre-pack liquidation. We have the expertise to help you set up a new company and, conduct a sale for value of the on-going trading element of the insolvent business to the new company and then close the insolvent company at a creditors meeting.

A lot of businesses that are experiencing financial difficulties are, on an underlying basis, sound trading companies. If you take away their immediate debt, they can flourish and continue to employ staff and generate sales.

It is vitally important in today’s economic climate to keep people with skills in employment, and to get companies trading with each other. We can help arrange a pre-pack liquidation for such businesses so that they can continue to build on the wealth of the country.

If you would like to pre-pack your insolvent company and re-trade in a debt free new company, please call us for an informal conversation on how we can assist, and the likely timescales.