HomeFWJ TakeawayResourcesWhat is the purpose of business rescue?

Business rescue is used by a company seeking some sort of company rescue because they find themselves in financial difficulties and may be coming under increased creditor pressure.

A successful restructure

A business rescue may involve some sort of company restructuring, business restructuring, or refinancing of a company to allow for a business turnaround.

It may be that this will involve an informal or perhaps more formal agreement with creditors not to pursue their debts through the courts, such as by way of a company voluntary arrangement. A CVA is a voluntary arrangement agreed between a company and its creditors that the creditors will not pursue debts or any formal insolvency process against the company requiring business turnaround during the course of the company voluntary arrangement.

Avoiding formal insolvency

The purpose of business rescue and a company rescue compared with a formal company insolvency process is to avoid a formal company insolvency process and all the disadvantages that this may bring to a company.

For example, the purpose of business rescue is to allow the business to continue to trade while being able to pay its debts and avoid formal insolvency. A business recovery strategy will usually involve something significant changing within the company to ensure that the business restructuring situation leads to a beneficial outcome both for the company in company rescue and for any creditors of a business turnaround situation.

A formal company insolvency process will often lead to the end of a business, or even if not, then there is a certain stigma attached to a formal insolvency process for a company and this may prevent some suppliers providing credit in the future. A formal insolvency process may also lead to an investigation of the directors of the company and is inevitably more expensive than a business restructuring plan that has been devised as part of a business recovery strategy by a business rescue expert and a company.


At Francis Wilks & Jones we often advise directors of companies on how they can look to a company restructuring and a business turnaround allowing for a company rescue. There are many methods to a business rescue and our team of business rescue experts can talk through the various options with you.

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