|
|
 |
| |
|
 |
| |
Voluntary Administration
Voluntary administrations are most commonly triggered when the director of a company realises that the company is insolvent or is likely to become insolvent. To avoid personal liability and reduce the chances of creditors acting to the detriment of the company, a director can take the initiative to maximise the business's value and appoint an independent administrator. A key rationale in opting for a voluntary administration is to provide a flexible procedure enabling a company time to seek an arrangement with its creditors, which may save the company while seeking to maximise a return to creditors.
During the voluntary administration, creditors cannot initiate winding up proceedings and directors' guarantees cannot be enforced. The majority of creditors must decide at a meeting convened by the voluntary administrator, the company's future. The options may include, selling a business as a going concern, realising the assets piece-meal and winding up the company, implementing a Deed of Company Arrangement which may result in the company being returned to the control of its directors, or returning the company to the directors in its current state.
During a Voluntary Administration, where possible, CBIA will work with stakeholders to "trade out" of a company's difficulties for the ultimate benefit of all concerned.
|
|
|
