Administrative Receiverships

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	Status			This is when a company defaults in fulfilling the terms of a loan agreement they have with a charge or debenture holder. The lenders can then exercise their right to appoint an insolvency practitioner to recover what is owed to them.
	Appointee			The lender appoints an administrative receiver (insolvency practitioner) to act on their behalf and realise their interest.
	Procedure and Outcome			The receiver will take immediate control of the company. The directors of the company remain in office, but their powers are suspended. The role of the receiver is to arrange for the disposal of the asset(s) the lender has control over. This often means the business is sold as a going concern in order to raise the necessary funds to repay the secured lender and any preferential creditors. If there are any surplus funds available to pay off unsecured creditors, the company is put into liquidation. In the absence of surplus funds, an application to have the company struck off will be made. It is always possible that the receiver could arrange for the company to discharge its debts to the secured lender, and leave the company in a sufficiently viable position to allow it to enter into a company voluntary arrangement, or even to continue as normal.
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