Company Recovery
We provide an independent national advisory service to the Directors of UK SMEs to assist negotiate & implement company recovery plans.
The Enterprise Act 2002 introduced new legislation emphasising company recovery to protect employment. Recovery of a viable core business is now often possible by effectively writing-off unsecured debt (including VAT, PAYE & tax arrears). This also releases it from onerous agreements (as they remain with the old company to be dealt with by the Insolvency Practitioner subject to Personal Guarantees). If a recovery is not viable the Directors may wish to place the company into voluntary liquidation.
Company Recovery
- Find out more about, Pre-Pack Administration/Liquidation.
- Compare, Pre-Pack or CVA?
Liquidation
- For liquidation advice please, Contact Us.
For owner Directors who wish to carry on the choice is:
Pre-packaged administration/liquidation
An agreement is made to purchase the assets & business from the insolvent company by the new company. The original company is then dealt with by an Insolvency Practitioner writing-off 100% of unsecured debt & onerous contracts (subject to personal guarantees). Pre-pack may give the greatest probability of recovery where there are no obstructions & pricing is based upon a valuation of the assets.
Company Voluntary Arrangement (CVA)
The existing company negotiates reduced payment terms with creditors typically reducing debt by as much as 80% with repayment over 60 months. It requires the approval of 75% of creditors or more (in value) of those present & voting in person or by proxy. The company must keep up with repayments or risk liquidation by default.
In the event that the business is no longer viable then the Directors may pass a resolution to place it in liquidation. The alternative is to wait to allow a creditor to issue a winding-up petition taking the matter out of your hands.
As long as the Directors have acted responsibly unsecured debt will be written off and they will not be disqualified. Taking the initiative is best practice.
Creditors Voluntary Liquidation (CVL)
Is the voluntary liquidation of an insolvent company by its own Directors & shareholders. This can be achieved by an Insolvency Practitioner.