Unipart Automotive has another week to negotiate rescue deal
At the end of last week Unipart Automotive renewed its intention to appoint administrators, which several sources have named as being KPMG. This is significant because, as was the case when news of the rescue talks broke on 8 July, such an announcement not only raises the possibility of the company entering administration but it can also provide a moratorium which acts as protection for a limited time.
The fact that the company renewed this for a further 10 days at the end of the last week gives us another deadline within which the company will have to complete its much reported rescue talks in order to be able to move forward without entering administration. With this is likely to mean the end of this week or the start of the week commencing 28 July at the latest. That said, the word is that the decisions are expected to be made sooner rather than later and therefore we should be looking out for news in the first half of this period.
According to Oxford-based solicitors Critchley’s, the notice of intention to appoint administrators provides protection against actions that “an aggressive creditor may be seeking to take (such as winding-up petitions, enforcement of security over the company’s property, distraint) to recover money due to them with no wider view for the best result for the business as a whole, the work force etc.” However it is also worth point out that, once filed, the proposed appointer does not have to proceed with the administration.