Corporate Insolvency

Investrend’s highly experienced and dedicated insolvency experts provide positive and practical solutions for companies and individuals in financial distress. We are insolvency experts with a wealth of knowledge and experience of exactly how to deal with your particular set of circumstances.

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Investrend Debt Solutions has trained and experienced consultants who can assist you with all your insolvency related concerns. Investrend Debt Solutions deals with the whole gambit of insolvency related issues – be it collections, payments or other arrangements with creditors or debtors – that can arise in a simple and easily understood manner.

Simple Options in the Complex Maze

We offer the following services:

• Voluntary Administration

• Liaison with Controllers including Liquidators, Administrators and Receivers

• Advice on all forms of Corporate Insolvency and Associated Matters

• Deeds of Company Arrangement

• Company Liquidation

Voluntary administration

Voluntary administration is designed to resolve a company’s future direction quickly. An independent and suitably qualified person (the voluntary administrator) takes full control of the company to try to work out a way to save either the company or its business.

If it isn’t possible to save the company or its business, the aim is to administer the affairs of the company in a way that results in a better return to creditors than they would have received if the company had instead been placed straight into liquidation. A mechanism for achieving these aims is a deed of company arrangement.

A voluntary administrator is usually appointed by a company’s directors, after they decide that the company is insolvent or likely to become insolvent. Less commonly, a voluntary administrator may be appointed by a liquidator, provisional liquidator, or a secured creditor.

After taking control of the company, the voluntary administrator investigates and reports to creditors on the company’s business, property, affairs and financial circumstances, and on the three options available to creditors (including employees).

These are:

• End the voluntary administration and return the company to the directors’ control

• Approve a deed of company arrangement through which the company will pay all or part of its debts and then be free of those debts, or

• Wind up the company and appoint a liquidator.

The voluntary administrator must give an opinion on each option and recommend which option is in the best interests of creditors. In doing so, the voluntary administrator tries to work out the best solution to the company’s problems, assesses any proposals put forward by others for the company’s future, and compares the possible outcomes of the proposals with the likely outcome in liquidation.

A creditors’ meeting is usually held about five weeks after the company goes into voluntary administration to decide on the best option. In complex administrations, the meeting may be held later if the court consents

The voluntary administrator has all the powers of the company and its directors. This includes the power to sell or close down the company’s business, or sell individual assets in the lead up to the creditors’ decision on the company’s future.

Liquidations

Liquidation, also referred to as winding up, is a process whereby a Liquidator is appointed to collect and realise the assets of a company and then distribute those funds in accordance with the Corporations Act and bring the company’s existence to an end. The purpose of liquidation of an insolvent company is to have an independent and suitably qualified person (the liquidator) take control of the company so that its affairs can be wound up in an orderly and fair way for the benefit of all creditors.

There are two types of insolvent liquidation:

• Creditors’ voluntary liquidation, and

• Court liquidation

The most common type is a creditors’ voluntary liquidation, which usually begins in one of two ways:

Creditors vote for liquidation following a voluntary administration or a terminated deed of company arrangement, or an insolvent company’s shareholders resolve to liquidate the company and appoint a liquidator. Within 11 days of being appointed by shareholders, the liquidator must call a meeting of creditors who may confirm the liquidator’s appointment or appoint another liquidator of the creditors’ choice.

In court liquidation, a liquidator is appointed by the court to wind up a company, following an application, usually by a creditor. Others, including a director, a shareholder and ASIC, can also make a winding-up application.

After a company goes into liquidation, unsecured creditors can no longer commence or continue legal action against the company, unless the court permits.