Pre-pack offer calculator

A pre-pack offer calculator estimates the price a UK administrator (an insolvency practitioner appointed under Sch B1 IA 1986) is likely to accept for a distressed business. Sell Ltd's calculator blends normalised EBITDA multiples, tangible asset value, TUPE liability drag and urgency discount into a low, central and high offer range you can defend in writing to the office-holder.

It's a first-pass triangulation, not a valuation. Real distressed deals move ±20% around the central number driven by secured-creditor demand, retention of title, competing bidders and IP defensibility. Use it to decide whether to spend two days on DD — not to bind your final offer. Companies House filings and The Gazette notices are what refine the range.

Normalised EBITDA (add back director salary above market, one-offs, and rent-arrears interest) drives 40–60% of the answer. Tangible asset value at market resale adds the floor. Transferring headcount subtracts TUPE liability (redundancy + holiday + pension arrears). Urgency compresses the multiple — a 5-day process gets a 25–35% discount vs a 4-week marketed sale.

Because you get no seller warranties, uncertain contract novation, potential customer flight and heavy DD cost. The Insolvency Service and Sch B1 para 3 mean the administrator's duty is to creditors, not you. Distressed multiples typically land 0.5–2.5x EBITDA versus 3–8x for solvent SME deals in the same sector [Source: Sell Ltd deal synthesis, Q1 2026].

Only if you're buying it. Most asset sales exclude cash and debtors — the administrator keeps them to distribute to creditors. If you're taking the book debts, deduct 30–60% for collection risk. Stock is usually offered at 20–40% of book due to fire-sale conditions.

TUPE 2006 reg 4 transfers all employment liabilities to you: accrued holiday pay, unpaid pension contributions, notice period and length-of-service redundancy exposure. Reg 8(6) can leave arrears of wages, holiday and pension with the state's Redundancy Payments Service up to statutory caps — this relief is why administration is bought so heavily.

The faster an administrator needs to close, the lower the multiple. A pre-pack signed on day-1 of appointment (SIP 16) demands a decisive bidder and clears at ~40–50% off a marketed sale. A 4-week marketed process with 3+ bidders typically clears within 10% of a solvent multiple.

Assume yes unless the sale qualifies as a Transfer of a Going Concern (TOGC) under VATA 1994 s.49. Where TOGC applies, no VAT is charged on business assets. If not, expect VAT at 20% on plant, stock and goodwill — but not on the sale of shares.

In writing, on headed paper, with proof of funds (bank statement or lender term sheet), a signed NDA, and the deposit terms (typically 10% on offer, balance on completion). Split the offer into fixed cash and any deferred/earn-out. Administrators (Begbies Traynor, Interpath, FRP Advisory) reject unfunded verbal indications.

Fixed. Administrators run competitive processes and can't take a range to creditors under SIP 16 evidence requirements. Use the calculator's central figure as your opening, hold back 8–15% for a second-round counter, and reserve 3–5% for exclusivity fee if it accelerates completion.

The administrator either counters, opens a second round, or refers you to a competing bidder. A 'no' is rarely final — Sell Ltd has seen 60% of rejected first offers accepted at +12% within 5 working days when the second bidder drops out. Track The Gazette for who else is circling.

No — CVA (Company Voluntary Arrangement) targets are trading solvently under a repayment plan, and MVL (Members' Voluntary Liquidation) targets are solvent by definition. Use a normal SME EBITDA multiple. This tool is calibrated for administration and CVL (Creditors' Voluntary Liquidation) buy-outs.