Anybody know what happens when the administrators are called in to a company ?

Caporegime
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Reason im asking is that i work for the struggling software firm Torex Retail

we've had a statement round at work that we're not to talk to the press, or leak confidential information. So im going to avoid discussing facts

but the telegraph is reporting that we may be put into administration by the end of the month

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/02/04/cntorex04.xml

Whats likely to happen if the administrators do move in ? we own 60% of the retail services IT sector, so there are a lot of assetts. But if we do go into administration, can the prospective buyer choose which assets they do and dont want, or will they have to take on all the loss making contracts too ? just that i work on 1 of those loss making contracts :(
 
Don
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they try and run the company till buyers can be found, they are immune from creditors but need to try and make it profitable to appeal to buyers

if they fail the company is liquidated
 
Caporegime
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if a buyer is found, will they be able to choose what to buy, or will they have to buy the whole package ?

and even if they do buy the package, will they have to honour all existing customer and employment contracts etc...
 
Don
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no they can buy a part but it is usually seen as preferable to sell as one


re contracts , generally workers kept on will stay on same contract but they can change things ( as can any company )
 
Caporegime
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hmm i worked at tiny/clock computer place which went into administration last year...(2005 i think? my memory is hazy)

the way it worked in our place was that the administrators came in, went through the financials, and then decided which part of the operation was salvagable and which wasnt.

they shut down the entire company, barring support which was still a money making center due to the Direct Debit support packages that customers were tied into.

the rest of the employees were chucked out, no pension, no compensation etc as the company didnt have enough funds to pay out, or indeed cover the last months wage of which we worked..

a lot of former employees are still fighting to recieve lost wages/cash from the government, unfortunately i wasnt elligible for anything as i had only been at the company for 11 months when it went under.
 
Caporegime
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Nickg said:
the way it worked in our place was that the administrators came in, went through the financials, and then decided which part of the operation was salvagable and which wasnt.

thats what i was thinking would happen

i know we have loads of contracts that loose money faster than a gambling addict in vegas.

if the administrators move in, or we're bought out. These will just get the chop im thinking ?
 
Caporegime
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MrLOL said:
if the administrators move in, or we're bought out. These will just get the chop im thinking ?

it tended to be departments which got cut, not individuals. So... if your whole department is profit center they may keep it, and then review individual accounts later.

for example, i was in the marketing department, which is obviously a cost center = get the chop.
 
Soldato
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I've been through this and its not fun.

The "am I going to get paid this month" thing really messes you up.

An existing contract can or can not be taken on by the company who buys you.

Basically its a liability the old compnay has but wether they new company would want to take it on is up to them.

This of course assumes a buy out.

What happened at my lot was the company took on all the existing work and backlog (contracts yet to be executed), but not any of the warranty liability for work completed, and not a project which was shall we say "going to the dogs".

Fortunatly for me the company is now stronger than it ever was before and moving onward and upward.
 
Caporegime
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well we've already been approached twice with regards to buyout

one of the allegations of the stock exchange investigation into torex is that these takeover bids were not reported to the stock exchange (or us employees)

so ive no doubt a buyer will be found. Just wanting to know what the administrators will do in the mean time (which i now know - thanks Rotty) and when a buyer is found, what they will do.

Unfortunately we're a solution provider. We really only have 1 department. And thats the customer contracts. Some are for hardware, some are for software. But all of our profits come from these contracts. I fear however, that when a buyer is found, the buyer will cherry pick these contracts, for the ones that make money. The ones that dont (like the one i work on) will be left without a buyer.
 
Soldato
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MrLOL said:
Reason im asking is that i work for the struggling software firm Torex Retail

we've had a statement round at work that we're not to talk to the press, or leak confidential information. So im going to avoid discussing facts

but the telegraph is reporting that we may be put into administration by the end of the month

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/02/04/cntorex04.xml

Whats likely to happen if the administrators do move in ? we own 60% of the retail services IT sector, so there are a lot of assetts. But if we do go into administration, can the prospective buyer choose which assets they do and dont want, or will they have to take on all the loss making contracts too ? just that i work on 1 of those loss making contracts :(

Again? Weren't you Anker before that?
 
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