Best Pre Pack Administration Companies

When looking for a Pre Pack Administration company you need to choose a reputable business.

The best Pre Pack Administration company 2024 is there to assist you with business debts.

There are many Pre Pack Administration businesses to choose from but here is the updated list of the top-rated Pre Pack Administration companies in the UK.

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Best Pre Pack Administration Companies 2024

From our research, here is a list of the best Pre Pack Administration companies in May 2024:

  1. Business Insolvency Company
  2. Business Debt Help 
  3. NTF Financial Solutions Insolvency
  4. Begbies Traynor Group plc
  5. Chamberlain & Co
  6. Company Debt Ltd
  7. Greenfield Recovery Ltd
  8. Top Insolvency Firms
  9. Wilson Field Ltd
  10. Purnells Insolvency Practitioners
  11. Forbes Burton
  12. McAlister & Co
  13. Clarke Bell Licensed Insolvency Practitioner

What is a Pre Pack Administration?

Pre-pack administration is an arrangement in which the sale of all or part of a company’s business and/or assets is negotiated and agreed upon before the appointment of a licensed insolvency practitioner (IP), with the required papers being completed and implemented immediately or shortly after the appointment.

This is not a novel insolvency technique for an insolvent business. However, with the shift from receivership to administration and a shift in focus from the appointing charge holder’s interests to the interests of the company’s creditors as a whole – as well as increased awareness among creditors, other stakeholders, and the media – pre-pack administrations have become increasingly visible in recent years.

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When is pre-pack administration appropriate?

Since it’s quite a costly technique, the pre-pack process is best suited for larger businesses. It is most effective when the company’s capacity to continue to trade is seriously jeopardized. A key supplier may withdraw assistance, or a winding-up action may be filed. Even if the company cannot survive in its current form, there must be a good “enterprise” there that someone is prepared to invest in.

When is a Pre Pack Administration the best option?

If you have an insolvent company with no secured creditors and there’s an urgent prospect of a creditor taking harsh action, such as a winding-up petition or even a cutoff of supplies & services which could destroy the value and faith in the business, a pre pack is usually the best alternative. Finance is a critical component for this insolvency practice.

Someone, usually a third party or related party such as the current directors, must be willing and capable of obtaining financing to purchase the company. Due to its high cost and complexity, this insolvency procedure is more typical among larger enterprises.

How does a Pre Pack Administration Process Work?

There are essentially 6 steps involved in the process of a pre-pack administration:

The Pre Pack Sale can take Place

The pre-pack sale can begin if the insolvency practitioner has satisfied their compliance duties and you can secure the necessary funds to fund the asset acquisition. Floating charge holders, such as banks and other lenders, will be notified after a contract is drawn up to designate the insolvency practitioner as the Administrator. The Administrator will send their applications to the court if they have no objections and everything else is authorized. The business will be sold to the new company or a third party shortly after that.

Seek Advice From Insolvency Practitioners

Are you having concerns about your company’s financial situation? Then contact an insolvency team or rely on professionals since they can help you come up with a fair price for your company and assets.

Licensed insolvency practitioners will go over all of your options with you at this time, including refinancing, a company voluntary arrangement (CVA), administration, creditors’ voluntary liquidation (CVL), and pre-pack administration. If you feel that a pre-pack Administration is a viable option for you, you’ll need to pass a resolution at a board meeting to discuss it further.

Marketing the Business

At this point, your IP will hire a trained surveyor to do a formal valuation of the company’s assets, goodwill, and intellectual property. The firm can then be advertised in local or national publications, online listings, and sales letters to potential buyers to attract buyers. If there’s no interest, the business can be sold to a new or existing company that’s been pre-arranged.

If there’s interest from other parties, the insolvency practitioner will review their bids.

Create a Business Plan for the new Company

If the former company arranges the business to be sold to a new company, a business plan must be prepared as part of the pre-pack Administration. To give an idea of the new company’s viability, it should include cash flow, profit & loss, and balance sheet forecasts. This evidence will be used by the insolvency practitioner to evaluate if a pre-pack sale is the most appropriate course of action if possible.

Financing the acquisition of the new company

While one ongoing concern is how to get an insolvent company up for sale immediately and for a fair price if not at market value, you also have to consider how to fund the purchase of the company and its assets.

Specialist lenders, such as asset-based lenders, factoring companies, and banks, may be willing to give funding. As part of a ‘buy and build’ approach, venture capital firms could be a potential source of pre-pack funding. You may be asked to give personal guarantees as a director of the new firm in order to gain access to these monies.

A business strategy and financial forecasts will be required by potential lenders. They’ll also want to know how their security requirements will be addressed, and they’ll want to put the independent valuations to the test.

The old company will be closed

Since business continuity isn’t a possible option, the former company’s trading activities must be shut down as the final step. The books and records of the corporation that’s faced financial difficulty will be transferred to the Administrator’s office, and any remaining assets will be liquidated. This allows distribution to its creditors after the Administrator is satisfied that there are no outstanding matters.

Pros & Cons of Pre Pack Administration

A pre-pack has a number of obvious advantages. However, there’re also a number of drawbacks to pre-pack administration that you should be aware of before making the decision. If you’re thinking of buying the assets of a failing business through a new company, here are several pros and cons to consider.


The business continues to operate with no interruptions or destroyed value

The corporation is swiftly protected by the court after the plan is completed and a purchase contract is written up. The administrator will be able to sell the “company and assets” as a result of this. Debts can also be forgiven.

The process is quick

A corporation can be “pre-packed” in a day if everything is in order.

Higher returns for creditors

A higher price is gained if the company’s assets are sold without disrupting operations. This means that creditors will receive more money than if the company went bankrupt.

The costs are lower

Since administrators don’t need to acquire financing to finance trade the firm, the method is less expensive than trading administration.

Directors can keep some control over the business

It boosts the company’s chances of success if it is sold to people who are already familiar with how the business operates. There are lessons to be learned in order to understand why the firm failed.


The process can generate negative publicity

The board of directors of a limited company can be observed releasing obligations and then going about their business as if nothing had happened. Unsecured creditors believe they have no say in the process and that they have been treated unfairly.

The company may be sold to a competitor

A competitor is frequently the most likely buyer because they are familiar with the company and see it as an opportunity to grow.

The conduct of directors will be investigated

The administrator is expected to submit a report on the conduct of the old company’s directors as part of the administration procedure, which takes happen after the sale is completed. While the majority of companies fail despite the best intentions of their board of directors, certain unscrupulous directors may be shown to have performed conduct that contributed directly to the company’s demise.

HMRC is particularly interested in seeing this report because they may refuse to register for VAT or impose conditions such as the payment of a bond if the director-turned-new-owner has a history of not paying taxes. Wrongful trading penalties can also be enforced retroactively and applied to former company directors.

TUPE rules apply

When transferring a firm to a new corporation, the 2006 regulations “Transfer of Undertakings (Protection of Employment)” or TUPE, stipulate that specific rules must be followed. While your intentions may be genuine & ethical in wanting your staff to keep their jobs, the new owner may have a different perspective.

This means that the purchasing business assumes liability for current employees from the start. Under TUPE standards, job contracts must be transferred over to the ‘newco,’ therefore you can’t fire people to save money in the “newco.”

The “newco” will need to be funded

If the business is to be sold to a linked party, they’ll be responsible for funding the asset acquisition. To avoid any problems, these will need to be priced independently. To assist with this stage of the process, it is best to consult a professional funder.

HMRC are likely to demand a VAT security deposit

If the “newco” has a significant HMRC debt, HMRC may want a deposit before allowing them to register for VAT. Keep in mind that the company was already bankrupt prior to any meeting or agreement.

The controversy surrounding pre-pack administration

In recent years, critics have claimed that the pre-pack administration process leaves creditors unpaid while allowing directors to simply walk away from the company’s debts. When a corporation engages in a pre-packaged transaction, however, it is more likely that they will not be able to repay their debts, leaving liquidation and administration as the only possibilities.

In other words, whether the company went into pre-pack administration or not, the unsecured creditors would have gone unpaid. In fact, a pre-pack administration followed by the liquidation of the old company is frequently the most advantageous solution for both creditors and the insolvent business’s directors and employees.

How Much Does a Pre Pack Cost?

One of the most significant benefits of a pre-pack administration is its cheap cost. There is no need to pay the administrator’s fees for a long time because the due diligence is performed before the administration and the sale of the old company is finalized as soon as the administration begins. As a result, it’s usually less expensive than a traditional administrative method.

Cost Inclusions

  • The pre-pack set-up costs
  • Valuing the old company’s assets
  • Funding the purchase of the old assets
  • Liquidation of the old company

What is the impact of TUPE on Employees in a Pre-Pack Administration?

The TUPE Regulations, which were created to protect employees when a company changed hands, are still in effect when a firm is sold via prepack administration rather than a typical sale.

Employee Dismissal at the time of a Pre-Pack Administration

No employee can be fired at the time of a business’s sale unless the reason is “economic, technological, or organizational” (ET0), according to the legislation. As a result, employers should be cautious about any human resource changes that occur during the business transition.

Employee Communication During a Pre-Pack

TUPE mandates that businesses communicate effectively with employee representatives or, in the event of businesses with less than ten employees, with the employees themselves. Employers must also be aware of the following:

  • The duration of the pre-package
  • The administration’s motivations
  • Any potential negative consequences on employees that are likely to occur
  • If the company is going to be restructured, make an assessment.

Where does the Money for Employee Wages come from During the Period Before a Pre-Pack sale is Agreed?

When employees haven’t been paid salaries in the weeks leading up to a pre-pack administration, the legislation allows money to be taken from the National Insurance fund, subject to specific restrictions:

  • Wages for up to eight weeks
  • A maximum of six weeks’ vacation pay is available.
  • If an employee has worked their notice term without being compensated, they are entitled to statutory notice compensation.
  • Contributions to an employment pension that have not been paid

How long does pre pack administration take?

The timeline usually takes 3 to 5 days. The IP will recommend that you seek an opinion from the Pre-pack Pool and submit viability statements for the new firm for the next 12 months in order for a pre-packaged sale to take place to you as a linked party. The contents of these statements, or a notice that you declined to take these actions, will be made available to creditors.

How long can a company trade in administration?

Administrations typically last 12 months, with extensions of up to 6 months available with court approval.

The length of time it takes for a company administration to complete from start to finish is highly dependent on the complexity of the case and the exit route sought. Administration is not, in general, a quick repair method.

Landlords and pre-packs

Because obtaining landlord permission to the assignment of leases prior to a pre-pack sale is normally impractical, the contract will usually provision for the purchaser to be allowed inside leasehold premises under a licence to keep the premises open and trading. You can use the Licence to Occupy Property—Letter Format as a guide. Licensing occupation to the purchaser entails the use of the property for administrative purposes.

What happens if the company can recover?

Even if a company is now in financial difficulties, there may be a viable business at the core of the situation. Debts accumulate for a variety of reasons, including poor trade decisions, considerable bad debt, or over-committing financially by signing into a costly lease or taking out high-interest loans. It’s possible that if you strip away all of this, the primary business model is strong and generates enough revenue to support a scaled-back version of the current operation.

What happens if a company cannot recover?

If the firm is unable to recover from its current financial difficulties, it’ll be placed in voluntary liquidation, during which all of its assets will be sold and the corporation will be disbanded.

By handling the company’s final transactions and closing duties at this time, the IP will ensure that directors are protected from accusations of wrongful trading, though a director conduct report will be compiled later that’ll examine the transactions in the years leading up to the company’s eventual insolvency.

Frequently Asked Questions

What is the difference between Liquidation and Administration?

Liquidation is the process of selling – or liquidating – an insolvent company’s assets before completely dissolving them. Administration, on the other hand, is usually used when there’s a prospect of preserving a company that is currently experiencing severe financial or operational difficulties.

Why do a pre-pack rather than a full administration?

The goal of completing the sale as rapidly as possible is to preserve as much goodwill and jobs as possible. The Administrator are responsible for running the business until it is sold – this is a very expensive procedure that is prohibitive for small businesses.

What information needs to be provided to creditors?

There is a great deal of information that must be shared with creditors, especially during the creditors’ meeting. This includes the following:

  • The company’s history
  • Proposed strategy for dealing with the firm’s assets
  • Information about the buyer
  • Licensed Insolvency Practitioners are in charge of marketing.
  • Assets are valued.
  • Reasons for the company’s downfall

Can the existing directors purchase the business from the administrator?

Yes, they can. If they’re engaged with the acquiring company, significantly greater disclosure regarding the purchase & conditions is required to safeguard creditors.


Despite the objections and unfavourable press, it’s widely acknowledged that the pre-pack deal is a helpful and viable insolvency service tool that can produce the best outcome for all parties of the old and new business involved.

Pre-pack administration is a highly complex field, and you should seek the advice of a certified insolvency practitioner as soon as possible. Most IPs give free confidential advice so you won’t have to worry too much about the costs either. Not only will this allow you to consider alternative solutions that may be more suited, but it will also ensure that the process begins before a creditor files a petition to wind up your business and business assets.

Other Debt Solutions

When analysing your credit report and current debtors it is advised to understand all the debt solutions available to you.

Here are all the debt solutions available to you depending on where you are based in the UK:

All UK Insolvency Practitioners

Here is a full list of Insolvency Practitioners in the UK:

The insolvency practitioner list above gives you plenty of options to choose the best IVA firm in May 2024.