Administration (ADM)


An Administration (ADM) is designed to hold a business together while plans are formed either to put in place a financial restructuring to rescue the Company, or to sell the business and assets to produce a better result for creditors than a liquidation. Administration can also be used where neither of these objectives can be achieved, simply as a mechanism to liquidate assets and distribute the proceeds to secured or preferential creditors, but this is not the primary purpose of the law.

Once an Administrator is appointed, they take over the running of the Company from the Directors and are responsible for any decision to continue or discontinue trading and they have control over how the Company and/or its assets are disposed of. The ability to continue trading depends on the availability of funds for working capital, the willingness of existing suppliers and customers to deal with the Company in administration and other factors specific to the Company’s business.

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