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What Should I Do If I Have Shares in Companies Which Are Under Liquidation

With a solvent company in liquidation, shareholders are in a much stronger position and are more likely to receive a return on their investment. If a solvent company wants to wind up, i.e. close down, the directors enter a Members Voluntary Liquidation (MVL) process.<br><br>If you have shares in a limited company that is insolvent, i.e. their debts are greater than its assets and it is not in a position to meet its financial obligations, as a shareholder you stand to lose your investment.<br><br>When a limited company is classified as insolvent, usually the directors of the company are either forced into

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What Should I Do If I Have Shares in Companies Which Are Under Liquidation

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  1. What Should I Do If I Have Shares in Companies Which Are Under Liquidation? If you are an investor with shares in a company, there’s always the possibility that the company may go into liquidation. If the company is solvent and it’s a case of winding up the company because it is no longer needed, or the owners wish to retire and there’s no-one to take over, as a shareholder you will receive a liquidating dividend, i.e. a combination of your regular dividend and the return on your investment. However, if it is an insolvent company in liquidation, there is a strong possibility you will lose your investment entirely.

  2. With a solvent company in liquidation, shareholders are in a much stronger position and are more likely to receive a return on their investment. If a solvent company wants to wind up, i.e. close down, the directors enter a Members Voluntary Liquidation (MVL) process. If you have shares in a limited company that is insolvent, i.e. their debts are greater than its assets and it is not in a position to meet its financial obligations, as a shareholder you stand to lose your investment. When a limited company is classified as insolvent, usually the directors of the company are either forced into liquidation by its creditors – compulsory liquidation – or they make the decision to enter a Company Voluntary Liquidation (CVL). Under the liquidation procedure, the liquidator appointed by the court prepares liquidation terms and order of preference of payment where the common stockholders are the last ones

  3. to be paid back their investment. Sometimes, investors may not even get anything against the stock they hold.

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