Our client was an established Bristol bakery which had been in operation since 1978 and a member of the National Association of Master Bakers.
The business had a retail operation which had the potential to operate as a viable business but it was being put at risk by the unprofitable wholesale side of the business. After receiving advice from our team of experienced insolvency practitioners the decision was taken to use a
pre-pack administration sale to help rescue the profitable side of the business and preserve as much of the existing workforce as possible.
A pre pack administration sale is a way to sell the business to a third party or a new company, in this case a company established by the existing management team, which enables the restructuring of the business and its debts whilst enabling the business to continue to trade and therefore preserve as much value as possible.
When the plan for the sale is ready and a contract of purchase drawn up the appointed administrator sells the business and assets (not the company) to the new owners. The unwanted debts and / or onerous contracts are therefore removed without interruption to the business operation.
As part of the arrangement the assets and goodwill of the business are independently valued and marketed to ensure the highest price is paid. The whole process can be done quite quickly and therefore prevent any further damage to the viability of the business by interrupting the supply chain.
The new company is now in operation with a significantly brighter future and 16 out of the total workforce of 43 have been retained.
Comment from Directors:
"Alison Byrne and her team at Byrne Associates made us feel welcome and at ease from the initial meeting. The information given was clear and concise and helped us take one of the most difficult decisions we have ever had to make.
We were made completely aware of what the process would involve and what people and organisations would be available for us to take our business into administration and what would be expected of us.
From that initial meeting we progressed smoothly through a four week period that, although traumatic in turning our lives upside down, was made much easier by the advice, help and support of all the professionals involved."
Read more about company administration and how it can be used to rescue a business or for a confidential conversation about issues faced by your business contact Byrne Associates on 01275 464 038.
