Corporate Rescue For business continuity and return to profit

The aim of our Corporate Rescue Service is to save your company so that it can trade its way out of difficulties and back into profit. The main stages to corporate rescue are: stabilisation, financial restructuring and refinancing and operational turnaround.

Business stabilisation

This involves us working with you to understand and address the reasons for the business' financial difficulties; assist with cash management; manage working capital and support and manage stakeholder needs.

Administration Provides protection and allows a company to continue to trade while the administrator, the directors and owners consider the company's options.

There is usually one of three main reasons why a company is put into administration:

1. to sell the company's assets, possibly back to the directors at fair value or
2. to enter into a Company Voluntary Arrangement and continue trading or
3. some form of reconstruction.

The Enterprise Act 2002 created a company administration procedure that was more efficient, streamlined and less costly than before. We can be appointed as your company's Administrator in a very short space of time, even a day. This will enable us to guide you through the financial difficulties, although a company's fixed and floating chargeholder must be consulted if there is one. A company should not go into company administration where it is of no benefit to either the company's secured, preferential or unsecured non-preferential creditors. In such cases, in these cases the proper insolvency procedure is company liquidation.

Administration provides a period of breathing space whilst the business is restructured and the ultimate aim is to ensure that the company is rescued from the brink of failure. Only Licensed Insolvency Practitioners such as Stephen Gilmore, can act as Administrators.

Should it not be possible to rescue the company then normally the aim will be to preserve as much of the business as possible - usually through a trade sale or sale to the management team. This provides the best return to creditors of the business (through a higher than auction price being realised for the assets), preserves jobs and presents a new start to the business (the debts are not normally transferred over to the purchaser).

The main advantages of Administration are:

• It provides a moratorium, preventing creditors from enforcing their rights, such as repossession of goods, sending bailiffs, etc;
• A company can often be placed into Administration and action taken to preserve the business very quickly (much quicker than liquidation)
• An Insolvency Practitioner can often allow the business to continue to trade during the period of restructuring (this is rare in liquidations)
• Administration can be used to facilitate the sale of a business as a going concern, free from its debt and obligations and
• Administration normally results in a better result for creditors than other procedures such as liquidation.

Once we have gathered the facts, we can advise stakeholders on the appropriate course of action.

Should Administration be considered to be the best solution, we will liaise with the existing management team, normally prior to appointment, to determine the appropriate strategy.

Once this has been established, it may be necessary to obtain consent from various parties including those that hold a charge over the assets of the company, e.g. the bank. We will discuss the situation directly with these parties as well as the proposed course of action and the impact this will have on them. Normally, consent is forthcoming and the company can be placed into administration relatively quickly.

More information

If you require further information or wish to discuss which of these options are appropriate for your business please contact us via our webform or call us on 0844 6933108.