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INSOLVENCY AND BUSINESS TURN-AROUND SPECIALISTS

INSOLVENCY AND BUSINESS TURN-AROUND SPECIALISTS

010 286 1966 | [email protected]

VOLUNTARY LIQUIDATION DEFINITION

Defining Voluntary Liquidation

VOLUNTARY LIQUIDATION DEFINITION

Liquidation is a legal process where the company stops trading, sells all its assets and distributes the proceeds amongst its creditors, and if there are no creditors, or they have been satisfied fully in the company’s wind-up, the proceeds get divided amongst its shareholders.

Liquidation can be done in one of 2 ways, either hostile or voluntary liquidation. In a voluntary liquidation the process is initiated by the Director or Members of the Company or Close Corporation after having resolved that the company is unable to pay its creditors. 

Hostile Liquidation are brought by a creditor of the company and the process is hostile from the get go. The Liquidator appointed will try and recover all assets that belong to the company as well as voidable dispositions that have been made to the detriment of it’s creditors. Furthermore, the Liquidator will be able to recover any payments made where a creditor has been preferred above other creditors.

Voluntary liquidation

Directors of a Business initiate the liquidate process. The nature of the liquidation process is a voluntary disclosure of the assets and liabilities of the company. For more info please see voluntary liquidation

Voluntary liquidations are complicated and the following aspects need be discussed prior to liquidation:

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Assets & Liabilities

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Cashflow & Balance Sheet

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SARS (Taxes Owing)

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Priority of Claims

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Loan Accounts (Group & Owners Loan Accounts)

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Employment termination & claims

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Rental Agreements & Other Contracts

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Suretyships & AOD's signed

 It is of the utmost importance that you get professional help when considering a voluntary liquidation. Our firm  has assisted thousands of clients in this regards.

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Liquidation Attorneys has been involved with some of the biggest liquidations in the country. Liquidations are highly specialized and we trust we will have the expertise to assist you.