Businesses going bankrupt and restarting

[Rick101]

Bit of a noob question and something I've never really understood, wondering if someone can give me a brief explanation.

Often hear about business going into liquidization, i'm assuming this is the same as bankrupcy. They owe plenty of people money and just shut up shop.

They then open again next day. I think they need to have a different person as director but that seems to be it.

Was reading this article in local press - http://www.yorkpress.co.uk/news/11487047.Police_pr...as_traders_claim_to_have_lost_125_000/
I know with Galtres you had to pre pay credit onto their 'G' card for any purchases. They've obviously had the money but then not paid any of the traders.

How can the business just start again when funds are still owed?
How can you run a business, get all the benefits and then just shut up shop and start again next day?

[Rick101]

Cheers but can't say I'm much wiser.

How close can the new owners be to the old owners?
What happens to all the money they're holding?
Do the debts get paid?
Why would anybody want to deal with the new owners knowing they'll go bankrupt again in a year?

[Rick101]

There are some small independent shops near me. Sell niche products, never seem to have anybody in the shop, never seem to do any business. Open, runs for a few months, closes, re opens. I always wonder if it's some sort of money laundering.

[Rick101]

oldnbold said:

If the Ltd Co directors have done nothing legally wrong they can often buy the assets back from the liquidator and open shop under a new Ltd Co.

Are they taking some massive wages or draw down then to be able to buy these assets back? If they are surely isn't that them deliberately running up the debt and causing the problem?

Where does the money the company has made/taken go to?

[Rick101]

But nothing to stop you setting up a business and selling something like event tickets then just liquidating once you've taken the money?

[Rick101]

I din't understand the in's and out's but I had a idea it went on. See so many business closing and starting up again a week later something dodgy was obviously going on.