The company can continue to trade if it's in administration. The administrators' objective is to maximise shareholder value, so if it believes the business can be sold as a going concern, it's important to collect cash to satisfy the creditors and help protect shareholders. This may not be what's happening in this case however...

Agreed if the company is in Administration. However, Dennis K's post mentions both Receivership and Liquidation (which are different) so I'm confused as to which.

Administration = company on life support but good doctors may breath life back
Receivership = amputation of an asset which may, or may not result in ...
Liquidation = the company dies.

Cheers

Whirls

Whyrls
I would have thought it was fraud to solicit moneys knowing there is a good chance you will not deliver the product?

It is .... but the key word is "knowingly".

When a company goes into Administration, a firm of Insolvency Practitioners is appointed to try to keep the business (not the company) going. The company's liabilities are frozen while the Administrator tries to salvage the business and make enough profits to repay the creditors.

If the company which ran the businesses of LOOP and BLADES goes into Administration, the Administrator can "kick ass" and try to fulfil the subscriptions which have been paid for plus producing further magazines.

Cheers

Whirls

Whirls - you're right, but I think DennisK may be confused. Liquidation is the last thing that happens to the company and usually takes months, or even years, after the 'doctor' has resuscitated the patient's assets - or not. There's no such thing as a liquidator as such, it's just the final process of the admin (i.e. winding up the company) and is performed by the administrative receiver.

Er .. not strictly true. The state of affairs of some companies can be such that they can go into a Creditors' Voluntary Liquidation straight away without having the process of either Adminstration or Receivership first.

If a substantial, non-secured creditor, feels that the company is trading fraudulently (i.e. it does not have the working capital to meet its liabilities), that creditor can apply to the courts for a Creditors' Voluntary Liquidation. If other creditors come forth (as they undoubtedly would after a posting in the London Gazette) and support the application, the courts can impose the liquidation.

There is also the Members' Voluntary Liquidation where the shareholders of a profitable company can just decide to commit suicide.

Cheers

Whirls

Well, liquidation is the last thing to happen to a company, but there are many things that could happen before that. If a company cannot meet it's liabilities as they fall due, the directors could be accused of trading whilst insolvent and that's an offence the directors could go to prison for. However, if those directors swear on a bible in front of a lawyer now and again, saying they believe funds will become available/they'll trade their way out of it, etc., the company can legally continue to do business.

A CVL can take a long time - more time than most distressed companies have - and even then, the court needs to decide. I know of several companies where the Crown has applied for a CVL but the company is still trading 8 months later! Also, very few SMEs read the London Gazette; the first they'll know of a company in admin (apart from chasing a/p) is when the administrator writes to them saying they're in control. Presumably, this is the letter than DennisK received, but it doesn't necessarily mean it's the end of the road. I wonder if the owners of Blade/Loop looked at a Corporate Voluntary Arrangement? Who called in the administrators?

500e
Just to be clear, the directors may have instructed Administrative Receivers on 24th december. Once appointed, the Administrator/s have complete control over the company and its assets; at that point, managing the business has nothing more to do with the directors.

The Administrator/s alone will decide on the best course of action for the business and if and when to call a creditor's meeting - not the directors (see above). The Administrator/s may or may not liquidate the company in due course. As I said, this is usually months after the appointment because trying to sell the business or it's assets, managing any fixed or floating charge holders, debentures, calculate dividends, etc. all takes time.

If you don't want to claim your 30 quid back from your credit card company, I suggest you contact the Administrator in your capacity as creditor and ask what's going on. They'll tell you to go away, but only after checking that your interest has been noted. Once noted, you'll get chapter and verse on progress of the administration, as well as detailed accounts and the circumstances leading up to the unfortunate demise of the business.

500e, all I, and toptobottom were doing is explaining the general principles behind company and business insolvency. The various terms of Administration, Receivership and Liquidation appear to have been used interchangeably, whereas they are all separate and distinct procedures resulting in different outcomes. I can't make any comment as to what is right and wrong since there has not been any confirmation of which insolvency route is bein taken.

Cheers

Whirls

As if by magic...........
 

Guess what arrived through my letterbox today................the February issue of Blades and Loop! :ok:

K77 - Same here.

Even after telling the (in administation) sales team that I would not pay for Blades and after them telling me that I'd never receive another free copy, my free copy arrived!

they say the hair and nails keep growing even after the body's dead...:uhoh:

500e - did you (or anyone?) contact the Administrators as I suggested?

I had a phone call from Loop's Subs department last week..

Trying to get me to take out a subscription - they seemed stumped when I advised them that I'd already subscribed!

What I bet the lady on the phone wasn't expecting was for me to then ask about the voluntary liquidation status and what was going on...

I was told that all was now sorted and there had been some form of management buy-out and that the Feb issue of Loop / Blades was being sent the same day.

Various posts in this topic seem to suggest some people have had a feb issue, however once again they don't seem to be sending it to people who've paid - their subs lists still seem screwy.

I phoned the office again on Wednesday and was told that I should have got my issue in the post - I advised I hadn't and they said they'd ensure another copy was put in the post... Alas I'm still waiting - hmmm

It seems they're dead keen to take money but not so on making sure people who've paid actually get what they've paid for, oh and that those who haven't paid aren't getting something!

DennisK have you as contributor got your copies through the post? From what you've been told, are they serious in continuing the magazine?

Here's waiting for the postman for my mags:-)

Jeff Hall

TB
They never took my money, so not an option.
It would appear that it was not just the delivery system that was screwed.

Well, I received my Feb copy too and I'm pleased if the Administrators have struck adeal with the management; I'm sure it will go from strength to strength, not least on the back of al the PR on PPRuNe!!

Good luck guys :ok:

Got a refund
 

Called my credit card company and requested refund. Two days later a form arrived to complete and 5 days after that the funds were back in my bank.

Simples.

Blades
 

I guess most of you will now know that the original management have sorted out a deal to get both BLADES and LOOP up and running again. My article on the Essex ASU scheduled for the old BLADES has now been published in an all glossy BLADES magazine ... out now.

Anyone can go bust in this mad business, Even Rolls Royce managed it and was going again within six months. I just wish their team better luck this time. Dennis K

Have all the creditors been paid? If not, I wouldn't be so quick to wish them good luck for the future unless it's a new management team in place.

BTW, I'm not an embittered creditor, but I do get a bit hot under the collar when a company fails, leaves a load of debts, and then re-emerges debt free as a new limited company, asking what all the fuss was about.

Hopefully this is not the case with Loop or Blades, but I reserve the right to be skeptical.

jez d

With respect, that's a rather naive thing to say. There are lots of reasons why a business can fail and not necessarily the fault of the management team.

The creditors will probably be presented with a proposal by the administrators for so many pence in the pound; I say probably because I doubt very much that the administrators have sorted out how much is left in the pot (if anything) in order to calculate a distribution yet.

'Phoenixism' is illegal and is so to prevent the habitual wind up and resurrection process that was so popular in the 80s. However, it is possibly to do a 'pre-packed' administration, which allows the administrators to realise some value from the assets of OldCo, as well as save staff jobs, etc. As I said before, if a creditor has registered its interest with the administrators, it will be given a detailed account of the circumstances leading up to the failure of the business.

If the management team of NewCo is the same (or similar) as OldCo, I applaud them for persevering and wish them all the very best with it :ok:

TTB