Administration

Administration may be appropriate where:

• The business is viable in whole or part but is under short-term financial pressure
• The company is facing legal action, such as a winding-up petition or threats from creditors
• Directors want to protect the business while a rescue or sale strategy is explored
• A going-concern sale is achievable, preserving jobs and contracts
• Immediate protection from creditor enforcement (including HMRC, lenders, landlords, suppliers) is required
• The business has value, but trading cannot continue safely without intervention
• A CVA or refinancing is being considered but creditor pressure needs to be paused
• Directors wish to avoid a disorderly collapse and ensure an orderly process with professional oversight

We will help you assess whether administration is genuinely the right route, or whether an alternative, such as a CVA, refinancing, or a managed wind-down, may be more suitable.

1. Initial assessment and advice on the best route

We begin by assessing the company’s financial position, stakeholder pressures, cash flow, and urgency.

We will explain the different routes into administration, whether initiated by the company, its directors, a qualifying floating charge holder (QFCH), or the court, and advise on the most suitable route based on timescales, creditor pressure, funding, and commercial priorities.

2. Who can place a company into administration?

Administration can be entered into in three ways:

• The company or its directors – This route is used where directors take early, proactive steps to protect the business. It is often chosen when a rescue, restructuring, or pre-pack sale is being considered.
• A qualifying floating charge holder (QFCH) – A secured lender with the appropriate charge may appoint an administrator if their security is at risk. Timing and process differ from a director appointment, and we will explain the implications clearly.
• The court – Creditors or other stakeholders may apply to the court for administration where pressure is significant, or negotiations have broken down.

We will always outline the advantages, risks, and likely timelines of each route so directors can make an informed decision.

3. Immediate protection: The moratorium

Once the notice or appointment is filed:

• Director/company appointment: the moratorium begins at the point of filing.
• QFCH appointment: the moratorium begins upon appointment.

This moratorium stops creditor enforcement, bailiffs, landlord action, and winding-up petitions, providing the breathing space needed to stabilise the situation.

4. Planning and pre-appointment work

We review the business’s trading position, cash flow, staffing and key contracts to determine:

• Whether trading should continue
• Whether a pre-pack or going-concern sale is viable
• Whether controlled closure or restructuring is more appropriate

Where trading continues, we assess viability, risk, funding needs, and regulatory/trading requirements to ensure safe and compliant operation.

5. Appointment of the administrator

Once appointed:

• The administrator assumes full control of the company.
• Directors remain in office but no longer manage the business day-to-day.

We ensure a smooth transition, communicate with employees, creditors, customers, and suppliers, and stabilise operations.

6. Trading, stabilisation or closure

Depending on viability, the administrator may:

• Continue trading to preserve value
• Trade only for a short period to complete work-in-progress
• Cease trading immediately where it is unsafe or unviable

We also handle all regulatory or sector-specific requirements, including licensing, compliance, insurance, and statutory notifications.

7. Review of options and implementation

The administrator evaluates the best achievable outcome, which may be:

• Rescue of the company as a going concern
• A pre-pack or open-market sale of the business or assets
• A company voluntary arrangement (CVA) following administration
• A controlled move into liquidation

The chosen strategy will always be based on maximising value and protecting creditors.

8. Realisation of assets

Assets are identified, valued, and realised in line with insolvency legislation.
This may include:

• Debtor collections
• Sale of business assets
• Sale of stock or equipment
• Assignment or termination of contracts

We ensure transparency, fairness, and clear communication with stakeholders throughout.

9. Distribution of funds

Once assets are realised, funds are distributed according to the statutory order of priority,

Creditors receive clear reports explaining asset values, realisations, and distributions.

10. Exit from Administration

Administration typically ends through one of the following:

• Rescue of the company
• Going-concern sale
• CVA
• CVL (Creditors’ Voluntary Liquidation)
• Dissolution

We discuss likely exit routes early so directors understand the potential outcomes from the outset.

✓ Immediate legal protection
Stops creditor enforcement, including HMRC action, landlord recovery, CCJs, and winding-up petitions.

✓ Breathing space to assess options
Gives the business time to stabilise and consider rescue or sale without constant pressure.

✓ Preserves value
It can protect jobs, contracts, goodwill, and assets that would be lost in a sudden liquidation.

✓ Opportunity for rescue
The company may continue trading, or a restructured business may emerge.

✓ Avoids disorderly collapse
Administration provides a controlled process managed by licensed professionals.

✓ Greater creditor confidence
Independent oversight can improve stakeholder engagement and support.

Administration is not appropriate for every situation. Directors should be aware that:

• Control passes from the directors to the administrator
• The process is public and filings appear on Companies House
• Costs are higher than some alternatives due to the level of work involved
• Trading in administration is only possible in limited, justified scenarios
• Lenders may have a significant influence if security is in place
• Certain contracts (e.g. licenses, leases and supply agreements) may be impacted
• Directors must cooperate fully and provide all required information
• Personal guarantees may still be enforceable by creditors

We will explain all implications clearly before any decision is made.