Restart Company Liquidation
There are many reasons why your business could be facing financial pressures or difficulties. If your company is insolvent, you might be considering a pre-pack liquidation.
What is a pre-pack liquidation?
A pre-pack liquidation is used when a business is facing insolvency. It involves selling a company’s assets at market value, as the company enters formal liquidation proceedings. The new company might be, but is not always, managed by the same directors but can also be third party buyers.
In pre-pack liquidation, once the assets and debts have been sold, the new company can start trading debt-free and the old company is liquidated – this is also known as ‘phoenix company liquidation’. It is very similar to pre-pack administration, where a viable buyer is found prior to entering the insolvency process but is done outside of court proceedings.
We understand that facing financial challenges can often feel overwhelming and stressful. If you need cheap advice from a team of professional Insolvency Practitioners, get in touch with Bridge Newland.
Is a pre-pack liquidation a legal process?
Yes, this is a completely legal arrangement. However, when starting a new company, there are some important restrictions that must be considered:
- The purchaser must pay a fair value for the assets from the insolvent company
- The creditors must be notified of the closure and liquidation of the insolvent business
- The name of that company should be carefully considered, so you are not being seen to mislead members of the public or creditors.
If you are considering liquidation, always get in touch with the experts at Bridge Newland first, for cheap and affordable financial advice. Our team will help navigate you through what can be an extremely complex and strict process.
What are the benefits of a pre-pack liquidation?
The key aspect of a pre-pack liquidation is that the sale of assets often occurs before the formal liquidation process begins. This allows for a swift transition, minimising interruption to the business and increasing the chances of preserving any jobs and ongoing operations.
The main benefits of pre-pack liquidation are:
- It can provide a better return for creditors
- It’s debt-free
- Employees can be retained by the new company (while jobs at the old business will have been made redundant it is possible that some or all of the staff will be offered employment at the new company)
- It allows the new company to start afresh with a clean credit history.
Are you exploring the idea of restarting your company via a pre-pack liquidation?
Is your business facing financial challenges? Are you thinking about restarting your company via a pre-pack liquidation?
At Bridge Newland, our team of insolvency specialists offer cheap solutions for businesses who are thinking about re-starting and are considering liquidation as an option.
We sepecialise in advising directors of insolvent companies how to set up again, while ensuring the interests of creditors are protected. At Bridge Newland, we recognise that the idea of liquidation can feel overwhelming, stressful and confusing. Our professional team of liquidation specialists are here to support you every step of the way. We support businesses from across the UK, including Rugby, Birmingham and London.
For a free, no-obligation initial phone call, call us on: 0800 612 6197.
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