In England there are three entry routes into administration :
MGA will work with the directors to:
An Administrator must perform his functions with the hierarchical objective of :
The Administrator must perform his functions in the interest of the company’s creditors as a whole.
Pre – Packs
A practice has developed – the pre-pack administration – where the insolvency practitioner who, it is intended will become the administrator, is involved with planning in advance a sale of the company’s business immediately after his appointment. The pre-pack is most appropriate where the insolvency is such that the business can be sold for a better price or its nature is such that the business value would deteriorate during an administration. Pre-packs have given rise to a degree of concern as creditors will usually have had no advance notice of the pre-arranged sale and no opportunity to have a say in the decision making process. With effect from 2 November 2015, the case for a pre-pack sale where a connected party is involved should be reviewed by a “pre-pack pool”. The aims of the pool are to increase the transparency of the pre-pack process in cases involving connected parties, and to provide assurance for creditors that independent business experts have review the proposed transaction.
MGA will ensure that connected parties considering acquiring a company’s business or assets through a pre-pack purchase are aware of their ability to approach the pre-pack pool. The website at www.prepackpool.co.uk includes a number of anticipated questions and answers about the operation of the pool.