Administrative Receivership ("Receivership") is a process under which the charge holder holds security by way of a Floating Charge, and appoints an IP known as an Administrative Receiver ("a Receiver") to realise the assets which are subject to a Floating Charge. Typically this will be a bank who holds the Floating Charge by way of security over assets which due to their nature e.g. they are perishables cannot be properly made subject of a fixed charge.

The Receiver will actually take control of the company and sell the assets which are the subject of the Floating Charge and apportion those funds realised firstly to the discharge of the floating charge holders’ debt. If there are any funds left over these are first appropriated to the costs of the Receiver and then returned to the company. At the end of the Receivership, there are a number of routes which can be taken as follows:- (a) The company can be returned to the directors and shareholders; (b) The company can go into administration; (c) The company can be wound up; (d) The company can go into a CVA. In those circumstances a company is subsequently wound up, information concerning which please Click on this.