Insolvency law (chiefly the Insolvency Act 1989 ["the Act"]) governs how companies go out of business or recover from crippling debt.
Management continues to run the day-to-day business operations in the case of a CVA and an Administrator appointed by the Court will run a company in the case of an Administration Order.
If a company goes into liquidation either voluntarily or is formally wound up by the Court, the company stops all operations and goes completely out of business. A liquidator may be appointed to "liquidate" (sell) the company's assets and the money is used to pay off the debt, which may include debts to creditors and investors.
Alternatively and finally the debtor may have an Administrative Receiver ("a Receiver") appointed under a floating charge.
Filed under: INSOLVENCY
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