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Companies in Liquidation

9 June 2013

What happens when a company goes into liquidation?  Here are five simple steps

Step 1 - Find a Liquidator.

Step 2 - Pass details of any company assets over to the proposed liquidator, and valuers may get

these valued. This will independently set the value of the assets for going to auction, or you may

wish to buy them.

Step 3 – Tell the liquidator who money is owed to.  The liquidator will write to them all to let

them know what’s happening and tell them that a creditors meeting will be held. This will quickly

remove creditor pressure and creditors will talk to the liquidator instead.

Step 4 – hand over all company information and books and records. The liquidator will use this to prepare a report to the creditors

Step 5 – A company director needs to "chair the meeting of creditors". In actual fact the liquidator will

run the meeting but you or one of the directors must attend it by law. The meeting of creditors is

usually a simple short meeting with no one attending.

Is that it?

Well, as far as the directors of the company are concerned, yes.  But the liquidator's job is not done.  They will need to collect in all the cash and actually "liquidate" the assets.  This means that stock will need to be sold,  debts chased up, books and records stored and money distributed.  This all tends to happen after the creditors meeting.

If you are interested in purchasing some of the assets of a liquidated company you can go to the auctions or approach surveyors who work with IPs. 

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