Selling and Insolvency
Companies need to have a basic understanding of Insolvency Law. When a company becomes insolvent there are two types of outcome; rescue, where the aim is for a part of the company to continue, and liquidation, when a company stops trading. Some companies will go through both of these procedures. This can happen when an administrator is appointed and sells the company’s primary business. Following the sale the administration ends and the company goes into liquidation.
When a company goes into administration and administrator takes control of the company and its management. They can remove and appoint directors and manage the business of the company.
The directors can elect to put the company into administration and appoint an administrator by filing notice with the court. The administrator’s main objective is to rescue the company. If they are unable to do so their aim is to achieve a return for the creditors.
Liquidation is the end game of Insolvency. A liquidator’s job is to sell and release the assets of the company and pay the creditors as much as possible. A company can be placed into liquidation voluntarily or by an order of the court.
Jeffrey Mills Solicitors regularly deal with such transactions. We can advise on:
- The procedure
- Implications for the business
- How the transaction will be financed
- How the proceeds will be divided
- Stamp Duty and other taxes
- Dealing with Companies House
- Dealing with the Land Registry
- Liaising with Accountants and Financial Advisers
If you are thinking of selling your business or are at risk of insolvency then call Jeffrey Mills Solicitors today for more information.