Publications search
Banking and finance eBulletin: Proposed changes in respect of pre-packaged sales in administration
On 31 March 2011, Ed Davey, the Minister within the Department for Business, Innovation and Skills (BIS) with responsibility for insolvency, announced that, in order to introduce greater transparency into the pre-pack process, he intended to require administrators to give notice to creditors where they proposed to sell a significant proportion of the assets of a company or its business to a connected party. A notice period of three days has been suggested.
This is to enable creditors to express concerns which the
administrator would need to consider, or to make a higher offer for
the assets, and, in cases where the circumstances justify it, apply
to the court for injunctive relief, before the sale takes
place.
The new requirements will apply not just to pre-packs but to any
sale back to connected parties in an administration where there has
been no open marketing of the assets.
The information required to be provided under SIP 16 would also be
lodged at Companies House, making it available to the world in
general rather than just creditors.
Click
here to read the full eBulletin.
12 April 2011
Author: Francis Bridgeman and Chris Lawrence
