Company Administrations Average About 1,600 per annum. More Emphasis Now Placed on Company Rescue.
This article is from Sarah Wege, a Senior Case Administrator here at Antony Batty & Company. Sarah focuses on our corporate clients and all aspects of work for CVLs, MVLs and Company Administrations, the topic of this article. Specifically, Sarah looks at the Insolvency Service’s statistics, which show that there are c.1,600 company administrations in the UK each year. She goes on to point out that as much emphasis as possible with administrations is placed on company rescue, and gives some examples of our work in this area that demonstrate this point.
When was the Administration Procedure Introduced?
Company Administrations were introduced in the Insolvency Act 1986. The Enterprise Act 2002 significantly enhanced Administrations, placing greater emphasis on company rescue. According to the Insolvency Service, the number of Administrations has remained steady over the past 5 years, averaging about 1,600 per annum and representing 10% of new company insolvencies. Administrations are an important part of the insolvency regime in the UK.
What is the objective of Administration? And the Benefits?
‘The administrator’, a licensed insolvency practitioner, is appointed to manage a company’s affairs, business and property for the benefit of the creditors, when it is insolvent. The objective of a company administration is to rescue it as a going concern, or if this is not possible then to obtain a better result for creditors than would otherwise be likely if the company were to be wound up.
For directors and companies under creditor pressure, an Administration provides a breathing space where:
- the Administrator can be appointed swiftly by filing a sworn notice at court,
- the company is protected against legal action from its creditors, such as a winding up petition.
- the Administrator can continue to trade the company whilst a turnaround or structured exit is achieved.
Some of the Company Administrations we have Worked on Recently
At Antony Batty and Company, we have experience of Administrations across a wide range of industry sectors, many of which have resulted in a much better outcome than liquidation. In the last 6 months, we have been able to:
- Find a purchaser for a professional services partnership. Here, we were able to sell the business intact and transfer all of the staff across to the new practice. In addition, we expect to pay a significant dividend to unsecured creditors.
- Achieve enhanced realisations and therefore a better result for creditors. This was through a pre-pack sale of a customer database for a travel agency and a sale of intellectual property and assets for a niche manufacturer, with dividends expected to be paid to secured, preferential and unsecured creditors.
- Repatriate leisure vehicles from Europe for sale. This was following our appointment as administrator to a specialised tour operator. We have particular experience and expertise as administrators of travel companies.
In addition, our recent appointments have included companies specialising in commercial building construction, plumbing and heating and water treatment, adding to our expertise in the construction industry.
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Contact us if Your Business is Insolvent and you Think Administration Might be the Answer
Our experience and expertise in Company Administrations has led to our current ranking of 16th in the UK’s Insolytics insolvency practice league table, higher than many ‘larger’ firms of Insolvency Practitioners.
Based in London, and with satellite offices in Brentwood, Salisbury and The Cotswolds, Antony Batty & Company provides independent, large firm thinking by local experts at sensible prices, for when it isn’t business as usual for our clients. Click here to see some of our testimonials.
If your business is facing financial difficulties, contact us or call us on 0208 088 0633 for a FREE initial discussion. If we are appointed as your company administrator, chances are that Sarah Wege will be the senior case administrator.
