At a Glance
- FWJ secured an urgent adjournment of a winding-up petition, giving the business time to consider restructuring options.
- We advised on a pre pack administration that preserved the trading business and met statutory requirements.
- The outcome protected jobs, maintained continuity across multiple sites, and delivered a better return for creditors than liquidation.
Why the client needed our help
We were instructed by a well-known Sri Lankan restaurant group operating multiple sites across the UK. The business had been hit hard by post-pandemic trading pressures, rising costs and cash flow strain. Matters escalated when the company received a winding-up petition, placing the entire group at immediate risk of compulsory liquidation, loss of jobs and permanent closure of the brand.
The management team needed urgent, specialist advice on their restructuring options, including whether a Company Voluntary Arrangement (CVA) or an administration process would deliver the best outcome for creditors, staff and the future of the business. We were instructed less than 24 hours prior to the hearing of the winding-up petition and had to urgently assist the company’s director to prepare evidence in support of an application to adjourn the petition.
How we helped
Our application for an adjournment was successful, which provided our team with enough time to work with the directors to assess the company’s financial position and the alternatives available under the Insolvency Act 1986. After attempting a CVA which ultimately failed, we assisted the company and its administrators with a pre-packaged administration. This was the most effective route to preserve the trading business while ensuring compliance with the statutory duties owed by directors during financial distress.
We coordinated the preparation and negotiation of the pre-pack structure, ensuring that all regulatory requirements were met and that an independent valuation and marketing exercise supported the proposed transaction. We also worked to protect the business from immediate creditor pressure arising from the winding-up petition while the restructuring plan was implemented.
As part of the transaction, the business and assets of six key restaurant sites were transferred to a new funded entity. This approach ensured continuity of operations, protected the brand’s reputation, and enabled the purchaser to provide future stability for employees and customers.
What was the outcome
The restructuring completed successfully. The pre-pack administration secured going-concern value for the business, protected roles across the UK, and maximised returns for creditors compared with liquidation. The brand was preserved, the restaurants continued trading without interruption, and the directors were able to move forward with a sustainable business model under the new entity.
The case shows the value of early, specialist advice when facing creditor action, and how a properly managed administration process can stabilise and rescue a viable business under significant financial pressure.
