A Comprehensive Guide to Business Rescue

When a company is struggling to pay its debts and is facing insolvency, one option that it may consider is company liquidation, which is part of the ASIC law explicitly designed for struggling small businesses as a faster, low-cost way to wind up an insolvent company.

When a business is trading insolvently, company directors can consider several options to get back on track. One option is liquidation, which involves selling assets to pay off debts. However, liquidation is not always the best option for a struggling business, and there can be other options to consider, such as business rescue or debt restructuring.

We Can Help with A Business Rescue

A business rescue is a process where a company’s management works with an insolvency practitioner to restructure the business and turn it around. The aim is to save the business and its employees rather than sell off its assets to settle debt with creditors. Debt restructuring, on the other hand, is a process where a company negotiates with its creditors to restructure its debt and repay it over a longer period of time.

If a business decides to go down the liquidation route, the liquidator will take control of its assets and sell them to pay off creditors. However, suppose the company directors choose to go down the business rescue or debt restructuring route. In that case, an insolvency practitioner will work with the business to develop a plan to restructure the business and repay its debts over time.

Discovering how liquidation and business rescue relate to each other is crucial for businesses facing insolvency. At the Liquidation Advisory Centre, we have a team of experienced experts who understand the different options available and the potential consequences of each. Contact us for a free, no-obligation consultation to understand the options available, including liquidation, business rescue, and debt restructuring.