Formal v informal agreement
A business recovery strategy may involve some sort of formal procedure, but this may not necessarily be a formal insolvency process. For example, it may be possible for a company in a business turnaround to reach a contractual agreement with its creditors to allow it some breathing space to repay debts and bring about a full business turnaround and company rescue. This may be by way of a company voluntary arrangement which is a voluntary arrangement between the company and its creditors by way of a contract. Similarly, it is possible to reach an agreement called a scheme of arrangement with creditors.
There are other less formal routes that a business requiring company rescue can take and it is a good idea to contact a business rescue expert who can devise with you a business recovery for a business turnaround.
This question “What happens when a company is in business rescue?” is dependent on what company restructuring or company rescue strategy is put in place for the particular company. It will also depend on what financial difficulties the company requiring company rescue is suffering, and how understanding are the creditors of the company requiring business recovery.
What can be agreed however is that a business recovery strategy should try to allow for a business rescue in as short a time as possible to avoid disruption to the business turnaround, and to avoid reputational damage to the business looking to achieve a company rescue.
At Francis Wilks & Jones we have a team of company rescue experts who can advise on the best options available to you in your particular company circumstances. Call us today to discuss your company and look at a business rescue strategy with our business recovery experts to ensure recovery of your business as early as possible.