Liverpool City Council was a creditor of a pharmaceutical research group, having made loans from its regeneration fund, as well as providing unsecured funding to the group which had been drawn down from national government funds. The group was unable to repay the secured debt on its due date, and an extension was agreed between the parties.
Despite requests for payment at the end of the extended term, some five years after the loan was advanced it had still not been repaid. The secured creditor issued a formal demand to the group; when this demand was not met, two FRP partners were appointed as joint administrators.
The business remained trading until it was returned to solvency and relisted on AIM some five months later. This was achieved by the sale of intellectual property concerning potential treatment for a type of cancer.
The sale of the intellectual property to a US buyer achieved $40 million, providing the group with enough funds to repay all creditors in full. Surplus funds of approximately £14 million were transferred to the group on its return to solvency. Following its exit from administration the group restructured its board and its operations.
The sum raised by a sale of IP that cleared all debts and provided surplus funds for the restructured group