ashbyjan
Well-Known Member
Just thought I would do a bit of digging as to the differences etc as oracle Linnell was so desperate to convince people that it would be liquidation and not administration.
If a firm goes under Administraion it continues trading, usually in the hope of selling it as a going concern but running is done by administrator not the original owners. If it goes into Liquidation, they are calling quits and shutting up shop and selling anything saleable off to pay creditors first, then, hopefully if there is anything left over, pay the share holders something back as well.
Guess for CCFC it means would SISU get more from selling of the assets - Ryton and some balls under liquidation as all players registrations would automatically revert to Football League. Also under Football Creditor rules football creditors would have to be paid first so if there are any ex-managers or transfer fees outstanding these would come first. There would also be ACL to pay off etc although SISU through the ARVO debenture would claim first refusal I believe. Back of an envelope calculation I cannot see this being worth more than a £1m to SISU. A Compnay can go into liquidation in 2 ways - either put itself in or a creditor can force it in.
If a Company cannot pay its debts when they fall due, any creditor can issue a winding up petition through the courts, which, if successful, will put the company into liquidation.
The Directors of a Compnay in liquidation are investigated to make sure they haven't acted illegally- ie traded knowingly insolvent, filed accounts late etc
If a Company goes into liquidation, the liquidators (specialised accountants) have to sell the assets to pay off the debts - usually there are insufficient assets in the company to do this so some owed money will lose out.
Alternatively, another Company can buy the company as a going concern (and its assets), but would leave the debts behind - again, whether or not those people owed money would get it depends on how much the company and its assets were sold for.
It is technically possible for a Director to set up a new company to buy the old but there are very strict rules governing this so it is unlikely they could do it just as a way of avoiding having to pay debts
A firm under Administration usually has some prospect of being sold intact as a still operating entity. It can be bought by another company who may inject new money into it, probably put their own management in, and hope to get it up and running properly again. So back of envelope accountancy if someone was to offer more than a million to SISU they would be better off.
Very simplistic analysis and I would ask OSB or Brighton to correct and/or expand.
If a firm goes under Administraion it continues trading, usually in the hope of selling it as a going concern but running is done by administrator not the original owners. If it goes into Liquidation, they are calling quits and shutting up shop and selling anything saleable off to pay creditors first, then, hopefully if there is anything left over, pay the share holders something back as well.
Guess for CCFC it means would SISU get more from selling of the assets - Ryton and some balls under liquidation as all players registrations would automatically revert to Football League. Also under Football Creditor rules football creditors would have to be paid first so if there are any ex-managers or transfer fees outstanding these would come first. There would also be ACL to pay off etc although SISU through the ARVO debenture would claim first refusal I believe. Back of an envelope calculation I cannot see this being worth more than a £1m to SISU. A Compnay can go into liquidation in 2 ways - either put itself in or a creditor can force it in.
If a Company cannot pay its debts when they fall due, any creditor can issue a winding up petition through the courts, which, if successful, will put the company into liquidation.
The Directors of a Compnay in liquidation are investigated to make sure they haven't acted illegally- ie traded knowingly insolvent, filed accounts late etc
If a Company goes into liquidation, the liquidators (specialised accountants) have to sell the assets to pay off the debts - usually there are insufficient assets in the company to do this so some owed money will lose out.
Alternatively, another Company can buy the company as a going concern (and its assets), but would leave the debts behind - again, whether or not those people owed money would get it depends on how much the company and its assets were sold for.
It is technically possible for a Director to set up a new company to buy the old but there are very strict rules governing this so it is unlikely they could do it just as a way of avoiding having to pay debts
A firm under Administration usually has some prospect of being sold intact as a still operating entity. It can be bought by another company who may inject new money into it, probably put their own management in, and hope to get it up and running properly again. So back of envelope accountancy if someone was to offer more than a million to SISU they would be better off.
Very simplistic analysis and I would ask OSB or Brighton to correct and/or expand.