The past 10 months have proved challenging for so many businesses – although, for some, the word ‘challenging’ may barely seem adequate. Could it be that liquidation, voluntary or otherwise, is the only likely outcome for your business? Maybe. But equally, maybe not.
Now, more than ever, is a time for cool heads. There could be support available from sources you never knew existed. There are numerous emergency schemes now available for all kinds of business, and it there may be one that fits your business.
Before taking draconian steps that lead you beyond a point of return, it’s time to pause … to take advice and explore your options. Recovery may be closer than you think.
At METTLaw, we’re perfectly placed to support business owners experiencing financial difficulties. We have the experience and expertise to help you to overcome your business challenges and turn your company around, fast.
Your company may be failing for all kinds of reasons. It could be suffering severe problems as a consequence of COVID. There might be cash flow problems, employee or management issues, lack of funding, over-expansion, or any number of problems specific to your particular industry and sector.
Here at METTLaw, we have many years’ experience of supporting businesses in trouble. The advice we give can make the difference between your company’s failure or success.
The key factor, ignored by so many businesses, is leaving it too late to ask for help. The sooner you respond to the difficulties you’re facing, the more options will be open to you. Burying your head in the sand is not one of those options.
We have the skills and expertise you need to analyse the issues you’re facing and to look at your consequential options. As soon as you feel your company might be facing solvency issues, then get in touch.
The short answer is – you almost always have more options than you think.
Despite short-term problems, there’s almost always a viable underlying business to rescue.
The trouble is, you’ve been so busy firefighting, you can’t see the wood for the trees. We’ll give you space and the tools to create focus. We’ll work with you to generate a successful business rescue strategy that will work for you and your business.
We’ll look at every relevant aspect of your company’s situation - the market, your suppliers, your customers and your funding situation.
Your business recovery options might include
If your company has no reasonable prospect of turnaround, then we can go over the best way to bring the company to an end, in your best interests and in the interests of the creditors.
A Company Voluntary Arrangement, or CVA, is a binding contract between a company and its creditors. If yours is a viable company that just needs breathing space from creditors, it could provide the perfect solution. It takes away the threat of legal proceedings by reaching an agreement with the majority of creditors not to take legal action. Once it’s signed, all creditors are bound by the CVA.
The benefit to the creditors is that, although they may not be repaid in full, they are likely to achieve at last some return.
Administration is a formal insolvency process brought by your company or its creditors. In some cases, a court makes an administration order over the company. An administrator is appointed who acts for the company during the administration.
The main purpose of administration is to rescue your business as a going concern or to provide an overall better result for your creditors than if the company were wound up.
One major benefit of putting a company into administration is that your company enjoys protection from the creditors due to a ban on legal proceedings being brought against the company while in administration. This gives valuable breathing space to rescue your company, giving it time to recover, or time to negotiate a sale of some or all of the business or assets, which in turn can save jobs and provide a better return to creditors.
The administration procedure is only suitable for businesses that remain viable at least in part and needs some breathing room in which to trade and consider options for the business.
There are three types of liquidation.
Once the court winds up your company, an Official Receiver is appointed, and they, or a liquidator appointed by them, will collect in the assets and distribute them, before eventually dissolving the company.
If you think any of these options might be suitable for your business, or you are facing a winding-up petition, or if you are owed money by a company, speak to us. We’ll talk you through the processes and your options in detail.
We’re always here to help.
Find out more. Call us on 0116 265 1538 or send us an email.
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