Bust companies revived in ‘phoenix’ deals more likely to fail again, study finds

Why This Matters

Key context: <p>Exclusive: research for the Guardian shows ‘pre-pack’ deals with former management also pay far less to creditors</p><ul><li><p><a href="https://www.theguardian.com/business/2026/oct/25/recruitment-boss-twice-bust-business-resurface-debts">The boss whose twice-bust business appears to be back</a></p></li></ul><p>Insolvent businesses reacquired by their previous management in “pre-pack” administrations are much more likely to fail again and tend to repay far less to creditors, research for the Guardian suggests.</p><p>The study is the latest to raise questions about the practice of “<a href="https://www.theguardian.com/business/2026/jan/06/recruitment-firms-phoenixism-liquidation-avoid-taxes-analysis">phoenixism</a>” – accounting’s controversial art of liquidating companies to allow directors to return with a new entity, free of debts.</p> <a href="https://www.theguardian.com/business/2026/oct/25/bust-companies-revived-in-phoenix-deals-more-likely-to-fail-again-study-finds">Continue reading...</a> This development from The Guardian highlights ongoing changes in the sector.