Liquidations - Creditors Voluntary, Solvent & Compulsory
Liquidation is an insolvency procedure used to deal with the winding up of companies or partnerships. It involves the realisation and distribution of the assets and usually the cessation of a business.
Liquidation proceedings can be commenced by:
- The Contributories (also known as Members or Shareholders)
- A director or directors.
- A creditor
- An administrator appointed to deal with the company.
A supervisor of a company voluntary arrangement. - An administrative receiver.
- Any other receiver.
- The Secretary of State.
- The Official Receiver.
- The Bank of England.
- The Attorney General.
The liquidation proceedings are similar regardless of which type of liquidation. A Liquidator, who can be the Official Receiver or an Insolvency Practitioner appointed to administer the liquidation of a company or partnership is appointed to realise the company's or partnership's assets and the proceeds of the realisations are distributed according to the regulations set down in the Insolvency Act 1986.
Liquidation usually results in a lower return to creditors and shareholders (members) than a corporate recovery or turnaround procedure as assets are generally dealt with on a "break up" basis.
Creditors Voluntary Liquidation, Solvent Liquidation & Compulsory Liquidation
There are four types of liquidation:
- Creditors Voluntary Liquidation
- Creditors Voluntary Liquidation – Centrebind
- Solvent Liquidation
- Compulsory Liquidation
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