Administration orders and winding up petitions are two very different things. Administration is a rescue procedure - so it is preferable but only if there is a business to save. Our brilliant company rescue team advises 100's of companies - let us help you too.
If there is a prospect of saving your business, then an administration order is definitely better. Where winding up spells the death knell of a company, administration is intended to be a company rescue process in insolvency rather than a “burial” of an insolvent business
Advantage of an administration order over winding up
The main advantage is that an administration order brings about a moratorium preventing the commencement or continuation of any legal action or processes against the company to allow it some breathing space whilst the administrators devise proposals to rescue the business as a going concern for the benefit of creditors and employees of the company.
- if no winding up petition has been issued against the company then directors can place the company into administration relatively cheaply via an “out of court” process, which becomes effective on the filing of certain documents in court.
- if a winding up petition has been issued but no order granted, then a qualifying floating charge holder can still enforce its security by using the same out of court route. The company itself, its directors and any other creditors would have to make an application to the court for an administration order in these circumstances.
For administration order or other insolvency / company rescue advice, please contact our expert administration order team at Francis Wilks & Jones and we will be happy to help.