Corporate Restructuring News: What happens now?
Creditors’ Voluntary Liquidation (CVL) is the most common UK insolvency procedure, usually instigated by directors and shareholders to bring a straightforward end to a company’s existence.
If a company cannot pay its debts or continue to trade, then a CVL will pass the responsibility of dealing with its assets to a liquidator, who will distribute the proceeds amongst the creditors according to statutory priorities.
We will prepare all the necessary paperwork the directors require to initiate the CVL process and arrange the necessary decision procedures for the company’s shareholders and creditors. The shareholders will be asked to pass a resolution to place the company into liquidation and appoint two of our licensed insolvency practitioners as liquidators.
The creditors will then make various decisions, including confirmation of the liquidators’ appointment. Our role is then to realise the assets whilst fulfilling various statutory filing and reporting functions. Then we would distribute the proceeds, after costs, amongst the creditors according to their entitlements. Three months after closure of the liquidation, the company is automatically dissolved.
When considering liquidation professional advice should be sought from us on the appropriate course of action. Our partners are licensed insolvency practitioners who can provide you with advice tailored to your requirements, assist with placing the company into liquidation and act as liquidators.
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