liquidation or takeover - which is more likely on this evidence?

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Hi, My DH's company has been in trouble for past year, more through mismanagement than lack of work. This week, there have been some people in going through things with the management team. MT are being very secretive and refuse to tell employees what is going on., saying they cannot say yet.

DH is not sure if these visitors are receivers (for insolvency) or valuers (for takeover). I always thought that if the receivers were called into a company that it could be publicized. DH is obviously hoping it is the latter and that is why it is being kept secret until takeover deal is finalized.

The business is still sending staff out touting for more business and all employees are still working. The management will also not tell staff if they are being paid on Monday.

The suspense is killing us, and we also need to know so we can arrange other money if he does not get paid.

I was wondering if any experts could hazard a guess on this evidence! thanks

Takeover. Insolvency usually starts with an announcement of appointment.

Takeover. Liquidators go in to take over the running of the company and are far more obvious - they would also tell the staff immediately that this was happening.

There is a 3rd option which is they may have breached their bank covenants and the bank may be doing its own investigation to establish if they are solvent, but that's far less likely (and would only be one or max 2 people)

It could be either. I used to work in insolvency and if we were going to be appointed as administrators - either by the management or by the chargeholder (usually the bank) - we would go in and go through the figures before appointment.

I'd imagine that if there's a question over whether salaries will be paid on Monday the bank are having a hissy fit and as such administration could be a real possibility.

Often the management of a company will look to buy the company straight out of administration in something called a "pre-pack". This will involve the sale of the good bits by the administrators on the same day they are appointed, so the insolvency of the company doesn't affect the employees or business side of the company.

If the company is in financial trouble then a takeover could well involve a formal insolvency procedure, so the new owners don't have to take on all the debt of the existing company.

If the company does enter formal insolvency procedures there is something called the Redundancy Payments Office who will sort out paying him wages due and a redundancy payment based on his years service, age and salary. Employees are the only preferential creditors these days, but they will be paid by the government and the money clawed back from the administration.

Is there a visitor book at reception? Your DH could go and have a nosy in that to see which company the visitors were from and then spend some time on google to see what that company does.

Agree regarding checking the visitor book, but you may need to google names not company. I work in M&A and if staff are in the dark about activities we only sign names, not organisation. What you need to do is find an unusual name and then search for it on linked-in.co.uk to find who they work for.

Hi, thanks for that! It looks like insolvency, will find out later. I have read about insolvency fund, so we should get his money back :) Luckily I have a bank of mum and dad which is always open for business.

If we find out it has gone under, do we just apply for JSA and tell tax credit office? is there anything else?