When liquidation is appropriate
Administration is usually appropriate when there is the prospect of saving some or all of a business and /or where the protection given by a moratorium on the ability of creditors to wind up a company or repossess assets will help an administrator get a better price for the business and assets than if the company was in liquidation. Where appropriate, a company or a lender can act very quickly to appoint administrators to protect a business or assets, unlike the position with a liquidation, where in most cases notice must be given in advance.
When liquidation is appropriate
Liquidation will usually be appropriate where a company has already ceased trading and where there is little or no prospect of doing anything other than collecting in and selling any remaining assets and, if proceeds allow, distributing them amongst the creditors.
