Study finds phoenix company revival deals more likely to fail and hurt creditors
Connected-party pre-pack administrations show 44% second-insolvency rate and far lower returns to unsecured creditors
Insolvent businesses bought back by their former owners in pre-pack administration deals are significantly more likely to fail again and give far less money to creditors, according to research commissioned by the Guardian from Turnstone Intelligence. The study analysed more than 1,700 administrations from 2019 and found that 44 per cent of connected-party pre-packs had resulted in a second insolvency by July 2026, compared with 26 per cent where the buyer was unconnected to the original company.