DO YOU WANT TO SUSPEND LEGAL ACTION AGAINST YOUR BUSINESS?
Placing your company or close corporation under business rescue can be the difference between survival or permanent failure.
Our experienced team will assist you to reach a compromise with your creditors.
Our team is based in Pretoria East, Gauteng but are rescuing businesses nationwide.
Even if your business is unable to be rescued we will safely guide you through a possible liquidation which can follow.
We can assist you in the appointment of a business rescue practitioner and all related issues. A business rescue practitioner is appointed by means of a board resolution or by means of a court application, depending on your circumstances.
Our team consist of senior business rescue practitioners, attorneys, advocates and auditors who will guide and advise you on all aspects relating to the rescue of your business and related legal action.
The following is an extract from Davis et al – Companies and other business structures in South Africa:
“There is no single factor that can be attributed to the failure of companies. While it is quite healthy and normal for companies to fail, the downside of this is that it may have a major impact on the economy and on the employees who are employed by that company. When winding- In any market-based economy it is a natural consequence that there will always be companies that fail. This is not necessarily a bad thing, and most industrialised nations recognise that failed companies are part and parcel of any healthy economy. If companies cannot be competitive within the market place, then it is a satisfactory result that those companies are either taken over by other, stronger companies, or wound up (liquidated). There are various factors that may give rise to the failure of a company, for example factors within the sphere where the company operates, national or international demand for a particular product, poor marketing strategies, or poor up a company, the revenue generated by that company will be lost to the economy, and the resultant job losses will have an extremely negative impact on the communities from where these businesses operated.
It is fair to state that in South Africa a liquidation culture is prevalent when it comes to dealing with failed companies. If a failed company is not the subject of a take-over or a compromise and arrangement, the only real alternative up to now has been the winding-up or liquidation of the company in terms of the provisions of the 1973 Companies Act. Liquidation of the company entails the appointment of a liquidator who then sells off the assets of the company and distributes the proceeds in terms of a prescribed set of rules. This is also the process that would precede the dissolution of the failed company.
Since the late 1990’s there has been a shift in approach in most industrialised nations towards rescuing companies instead of liquidating them. Corporate rescue is the new international buzzword, and the straightforward liquidation of companies has become rather unfashionable. Although the term “corporate rescue” is used to describe this relatively new phenomenon, the terms “business rescue”, “restructuring” and “rescue” is used to describe this relatively new phenomenon, the terms “business rescue”, “restructuring” and “reorganisation” are all terms that one may come across to describe what is essentially the same thing. It needs to be emphasised that the terms “business rescue” (this is the terms employed to describe the new procedure incorporated into Chapter 6 of the Companies Act, 2008) or “corporate rescue” is not meant to denote or imply that the company or the business will necessarily be saved by the prescribed procedure.
While the new procedure obviously does strive to save failing businesses, this will not necessarily be the eventual outcome. It may, for example, happen that the business of the company has been sold as a going concern in cases where the company cannot be saved; but if this sale of the business means that the employees’ jobs have been saved and a better return has been obtained for the creditors of the company owing to the sale of the business as a going concern, then this would fall within the parameters of what can be a termed a corporate rescue.”