As a business owner, I know you never imagined the day you'd have to consider Administration. I appreciate this is all new to you, and you're trying to come to terms with how this has happened. Never mind what you should do next and what on earth a Pre-Pack Sale is. Let me see if I can help.
A pre-pack sale is a planned insolvency process. Your business assets are sold to a connected party before or within 8 weeks of placing your company into Administration.
If the business can't keep trading as it is without the company going under, whatever circumstances are now being faced. A Pre-Pack Sale can be a way to salvage your business and save jobs.
It's not only my recommendation that you reach out to an evaluator to ensure you understand what the Pre-Pack Sale entails. It's also now a legal requirement that no Pre-Pack Administration completes without an independent evaluation.
Why Pre-Pack Evaluation Matters
New British regulation introduced in May 2021 outlines a set of minimum standards that Administrators must adhere to when selling business assets to a connected party - AKA a Pre-Pack Sale.
You must now obtain an opinion on the purchase of the business or assets from an Independent Evaluator before a Pre-Pack Administration goes ahead.
Your Evaluator has to hold the relevant knowledge and experience to decide if the terms of the connected party sale are fair and reasonable. Crucially, they also need to have professional indemnity insurance to give you peace of mind that you're dealing with someone up to the role.
I was an Insolvency Practitioner for 25 years, and I understand the world of Administration inside and out. I'm still a member of R3 - the trade association for the UK's insolvency and restructuring professionals.
Unwavering Confidence
I'll go out on a limb and say I'm the only Evaluator in the UK with specific wording on my indemnity insurance for Pre Pack Evaluation. The underwriting on this assurance wasn't done cheaply, quicker or easily, but I insisted on it. This extra backing for you proves that insurers trust my experience, and I wanted this additional approval for your confidence. The ownership is on me to get my recommendation correct, not on you if things go wrong down the line.
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