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What is the role of a liquidator in the case of voluntary winding up of a company?

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Leading UK
What is the role of a liquidator in the case of voluntary winding up of a company?

There are a variety of reasons why a company would enter voluntary liquidation; it could be a director or directors wanting to retire or it closing one company to start another. What’s more, it could be transferring assets from a company to its shareholders, due to a company restructure, or it could be just that the owners of the business don’t have anyone to hand over to and just want to close the business. Whatever the reason, a solvent company can choose to voluntarily wind up a company and this is called Members’ Voluntary Liquidation, or MVL. Alternatively, companies may enter a CVL, or Creditors Voluntary Liquidation, if the company is insolvent.

To enter into an MVL, the business must be solvent, i.e. they are able pay their creditors within a 12 month period, and the company’s board shareholders must be in agreement. Once the decision has been made to wind up the company and after the initial meetings, a liquidator will be appointed by the shareholders or directors to handle the voluntary liquidation of the company.

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