Recovery solutions

Insolvency and Recovery

In difficult times, we are here to give prompt, professional help.

Why work with us

We are a national team with significant experience in all aspects of recovery work, dealing with both corporate and personal matters. We analyse the difficulties you have encountered and explain the options that are available and suitable for your needs. If you then instruct us, we act promptly, professionally and effectively.

We have developed a large network of business contacts and professional advisors, which include bankers, solicitors and accountants. In many instances, our professional advice has led to the rescue, in whole or in part, of on-going businesses, with the protection of employment for members of staff. Our work ranges from dealing with family-run businesses to large PLCs.

What we do for you

The Recovery Solutions team at Crowe delivers tailored solutions to clients under financial distress. We offer services ranging from advisory and informal solutions through to the formal insolvency procedures. As proponents of the business rescue culture, we want to see your business thrive and prosper, helping you overcome financial challenges.

We offer a free consultation to review a company’s affairs and we will provide advice to a Board on what we consider to be the best option(s) for a company and its stakeholders. We will provide practical advice and help avoid the pitfalls of creating a personal liability for not acting in a company’s best interests.

Areas we can support you in
Administrations
Advisory
Company Voluntary Arrangements
Corporate Simplification
Solvent Voluntary Liquidations
Insolvent Liquidations
Administrations

Administration is a recovery procedure to protect a business and enable its rescue as a whole or in part as a going concern, whilst enhancing the outcome for stakeholders generally. Administration typically assumes that there is a viable business to be rescued.

The process of appointing an Administrator stops all legal actions and places a moratorium around the company. This allows breathing space to restructure a business. An Administration must have a purpose aimed at rescuing the company, enhancing the value of a company's assets, and/or providing a return to creditors.

A Pre-Pack Administration occurs when a company arranges to sell its assets to a buyer, before appointing Administrators (who completes the sale upon, or shortly after their appointment).

An Administrator acts in the interests of a company's creditors.

Administration is a complex area and if it is deemed to be an appropriate tool, a tailored strategy will be proposed to meet the needs of an individual business. For more information on whether an Administration is right for you, contact one of our Insolvency Practitioners to arrange a free consultation. Our Insolvency Practitioners derive satisfaction from rescuing a business and have wide experiences of acting in a large number of business rescues. We will work with stakeholders to provide the best outcome for a company and guide directors through the process.

Advisory

We assist directors in evaluating and implementing potential solutions to financial difficulties. This includes liaising and negotiating with stakeholders such as HMRC, landlords and major suppliers.

Our advisory services are provided with the intention of avoiding formal insolvency procedures and preserving shareholder value.

Company Voluntary Arrangements

A CVA is in essence, a tailored and negotiated settlement with creditors, for a company that is insolvent and facing either liquidation or Administration. The CVA process allows a company to restructure the finances of a company where it may be encountering cashflow difficulties. A CVA often results in a company's debts being repaid (in part or in full) over time, typically over three and five years. A CVA will need to provide a better outcome to the alternatives of liquidation or Administration.

For a CVA, the business of a company must be able to survive. Often a CVA can quickly improve cash flow and it can stop pressure from creditors. Trading forecasts and cash flow projections will need to show that the terms of the CVA can be met, and that the CVA is a viable alternative to liquidation or Administration. A CVA must be approved by a majority of creditors greater than 75% (of those voting). After the CVA is approved, it becomes legally binding on all creditors (even if they voted against it).

The CVA process enables a company's director(s) to retain their executive powers, to continue the business under the supervision of a Supervisor, and continue to pay creditors (via the CVA) from the profits generated from the ongoing business, all for the good of the creditors and thereafter the shareholders.

For more information on CVAs, contact one of our Insolvency Practitioners to arrange a free consultation. Our Insolvency Practitioners derive satisfaction from rescuing a business and have wide experiences of acting in a large number of business rescues. We will provide support to the business to manage the effects of a CVA and work to minimise its impact on trade.

Corporate Simplification

In many corporate groups there are entities that are surplus to requirements. Corporate simplification is the process of removing surplus entities from the corporate structure.

A corporate simplification process can result in a release of capital, allowing funds to be redistributed and a reduced administrative cost. Additionally, professional costs for tax returns and audits can be reduced and tax efficiencies may also be found.

The winding down of surplus entities can be with use of a Members Voluntary Liquidation (MVL), being a solvent liquidation process, or by dissolution. An MVL is more expensive than a strike off but the MVL process provides comfort that a statutory process of advertising for creditor claims, realising assets and distributing any surplus to the shareholder(s) has been followed.

At Crowe, we have a flexible fee structure, which can be aligned to the level of our involvement in the project. If the simplification exercise concerns a number of entities, because of economies of scale, the cost of each individual liquidation can reduce.

We work with the management and shareholders to identify risks and achieve the objective of the simplification process, undertaking a project manager role if required.

We have broad industry expertise and can draw upon our restructuring and tax teams in the UK and in other jurisdictions, across 146 countries worldwide.

Solvent Voluntary Liquidations

We use the Members' Voluntary Liquidation (MVL) process for those companies who are solvent, often for taxation and restructuring purposes. The shareholder(s) appoint a liquidator who realises a company's assets, ensures there are no unpaid liabilities and pays the surplus assets to the shareholder(s).

The process is often used as an exit strategy for a company as there is often tax efficiencies when a distribution of capital is made by a liquidator (when compared to a distribution under income tax rules). Alternatively, an MVL can be used when the business of a company has come to a natural end.

The MVL process provides comfort that a statutory process of advertising for creditor claims, realising assets and distributing any surplus to the shareholder(s) has been followed.

Insolvency Practitioners at Crowe have acted in a large number of MVL cases. We are able to provide individual solutions to the MVL process and are often able to make an early return to shareholders of a company's surplus assets. We have a flexible fee structure that can be aligned to our level of involvement in the MVL process.

Insolvent Liquidations

We deal with Creditors' Voluntary Liquidations (CVL) and Winding-up by the Court (WUC) when a company becomes insolvent.

Liquidation can be necessary if a company is unable to trade out of its financial difficulties and it is not considered viable in its current form. A CVL is a liquidation process for a company that is unable to pay its debts that is commenced by its board of directors. A WUC takes place when a company is forced into liquidation by the court, upon presentation of a winding up petition.

Directors are under a duty to take all possible steps to reduce the losses of creditors and this may necessitate a need to close down the business of a company and thereafter to place it into liquidation. Whilst the choice of liquidator in a CVL is made by the creditors, the directors nominate a licensed Insolvency Practitioner to assist them. The director(s) choice of liquidator is likely to become the liquidator by a decision of the creditors. It is to the creditors that the liquidator appointed has their primary duty of care.

A liquidator's main function is to identify and realise the assets of a company and pay distributions to creditors (in a set order of priority). It is possible for the directors of a company in liquidation to purchase a company's assets from the liquidator.

There are a number of options available for an insolvent business and Insolvency Practitioners at Crowe have extensive experience in a range of sectors and have acted in a large number of liquidation cases.  We provide tailored solutions and understand that placing a company into liquidation can be a stressful time for all stakeholders, from directors, shareholders, employees and clients alike. Our Insolvency Practitioners will provide support to individuals as the effects of the CVL are felt.

Contact us

Vince Green
Vince Green
Head of Recovery Solutions
Kent