Restructure and Rescue

Trading conditions have been extremely tough in recent years. Many businesses are burdened with a millstone of debt and are in desperate need of a fresh start. 

So what options do business managers and directors have when struggling in a sea of debt? If there’s a solid and successful business to save – whether it’s all, or just a part, of the company’s current operations – one lifeline can be via a ‘pre-pack’ administration order, an insolvency process where the business is sold back to its management, leaving the debt behind.

There’s nothing wrong with directors or shareholders buying back their own business and making a fresh start – the key is the transaction has to be carried out with transparency and probity, with full value being paid for the business to ensure that all creditors get a fair deal. Completing a transaction will often require third party funding and corporate finance options are available to borrowers.
The key lesson is simpleIf you think there’s a problem, get advice early. If you’re under pressure from creditors, the Revenue, bailiffs, or can’t pay the bills at the end of the month then it’s time to get some help.