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Parent Company goes into Receivership...

  • 08-08-2011 11:03am
    #1
    Paulusmaximus
    Registered Users, Registered Users 2 Posts: 391 ✭✭


    Just a quick question on receiverships/examinerships...

    If a parent company goes into receivership or examinership do the subsidiary companies also go into receivership/examinership or can/do they continue to trade as normal?

    thanks..


Comments

  • #2
    djk1000
    Closed Accounts Posts: 899 ✭✭✭djk1000


    Receivership - It depends on the debenture and what it covers, if it is a fixed and floating charge over all the assets, then it is very likely that it would cover the shares which the parent owns in the subsidiary.

    Exeminership - It is only the company that goes into examinership that is in examinership, however, as part of the scheme of arrangement the shares of the subsidiary would be on the table as part of any scheme to ensure the survival of the parent company. It would be subject to High Court approval and a Judge would be looking at the impact on creditors and employees in the subsidiary too.


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