If the partners believe in the fundamental viability of the business and are determined to fight for the business to help survival then a rescue mechanism exists that can be a powerful tool or framework for the restructuring of the business.
The best way to think of an partnership voluntary arrangement (or the very similar CVA) is as a deal between the debtor (the partnership that owes the money) and the creditors; the people or businesses to whom the money is owed.
Who should use a PVA?
It is imperative that the PVA is only used where a partnership’s business is viable or where it has disposable assets that can be turned readily into money in the short to medium term. Using the PVA can allowed time to sell such assets for better value than a liquidator can obtain.
See below for a flowchart of the process: