Administrative Receivership is often referred to simply as ‘receivership’.
If your company has breached the terms of its borrowing from a secured creditor with a floating charge over a significant part of your company’s assets, that creditor has the option of appointing an Administrative Receiver to recover the monies you owe. You may have given your bank such a charge, for example, as security for your borrowing.
The Administrative Receiver will look to sell the charged assets of your company in order to repay the sums owed to your secured creditor.
Impact on your business of Administrative Receivership?
The Administrative Receiver may continue trading with a view to selling your business as a going concern. This approach is likely to generate a higher return than simply selling individual assets. A sale gives the business a chance to trade under new management.
Depending on the circumstances, the appointment of a receiver may not be the only route available to your company. If you have concerns about your business finances and would like to know more about administrative receivership and how it would affect your business, call us today for advice on 0114 285 9500.