Greensill Capital and the Use of the Administration Process in UK Company Law : An Incomplete Case Study

Ellina, Sofia and Milman, David (2024) Greensill Capital and the Use of the Administration Process in UK Company Law : An Incomplete Case Study. Law and Financial Markets Review, 17 (4). pp. 257-271.

Text (Greensill paper LFMR)
Greensill_paper_LFMR.pdf - Submitted Version
Available under License Creative Commons Attribution.
Download (406kB)

Abstract

This paper examines the Greensill collapse, with a central focus on the UK company administration procedure under the Insolvency Act 1986, exploring its broader implications for international corporate finance regulation. It analyses the events leading to Greensill’s collapse and the challenges encountered during the administration process, shedding light on stakeholder rights and the delicate balance between national and international legal frameworks. This case illustrates the intricacies of contemporary administration practices, demonstrating how administration can serve as both a rescue mechanism and as a tool for a more efficient liquidation, aimed at maximising asset value to provide better dividends for creditors. Ultimately, the paper underscores the risks inherent in financial innovation, offering lessons for the ongoing evolution as regards to the usage of administration. As the Greensill saga continues, the paper anticipates future developments, emphasising the need for systematic understanding and vigilance in complex financial scenarios.