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Louise Jennings

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Autor

Louise Jennings

Professional Support Lawyer

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1. Februar 2021

R&I update - February 2021 – 1 von 4 Insights

Recent developments in UK administrators' dealings with prospective buyers

  • Quick read

In Uralkali v Rowley and another [2020] EWHC 3442 (Ch) – a UK High Court case relating to the administration of a Formula 1 racing team – an unsuccessful bidder for the company's business and assets sued the administrators, arguing that the bid process had been negligently misrepresented and conducted.

The court found that the administrators did not owe a duty of care to the disappointed bidder. It rejected the claimant's criticisms of the company’s sale process and determined that the administrators had conducted it "fairly and properly" and were not, in fact, negligent.

The court has consistently shown reluctance to interfere with the decisions of officeholders that are properly made. It has found grounds to intervene in certain circumstances, however, including the removal of administrators from office where there was a "serious issue for investigation" by an independent party into whether a proposed sale was in the best interest of the company and whether the administrators had breached their duty in agreeing to the terms of the sale.

Key points to look out for

  • Was the business marketed with due diligence?
  • Have the business and assets been fully and independently valued?
  • Has financial and sale information been made readily available to allow informed bids from all parties?
  • Did the sale process and/or lack of information effectively exclude the possibility of competing bids and, therefore, a genuine market upon a level playing field?

Here to help

To discuss these points in more detail or to review particular aspects of a proposed purchase, please reach out to a member of our Restructuring & Insolvency team.

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