Interrogating and Indulging Prepacks: Re Kayley Vending
Corporate Rescue and Insolvency , Vol. 2, p. 168, 2009
6 Pages Posted: 23 Sep 2009
Date Written: September 23, 2009
The patois “prepack” in UK corporate insolvency practice is a shorthand description of a strategy to sell an insolvent debtor’s business, typically involving the following scenario: A sale of all or part of the debtor’s business is struck in principle between the relevant parties prior to the commencement of a formal insolvency proceeding (usually administration) so that as soon as the relevant insolvency officeholder is appointed, he will use his power to procure an immediate execution of the pre-agreed sale. The debtor will then be liquidated. In the recent case of Re Kayley Vending  EWHC 904 (Ch), the court gave some helpful guidance on the prepack practice. It is no exaggeration to say all insolvency practitioners should familiarise themselves with the decision.
Keywords: UK corporate rescue, prepack, prepackaged administration, administrators' preappointment costs
JEL Classification: K10, K19, K20, K29, K30, K39, K40, K41, K49
Suggested Citation: Suggested Citation