How a Company Voluntary Arrangement can help you…

A Company Voluntary Arrangement, or CVA as it is known, is a formal alternative for company’s wishing to avoid liquidation.

It is a contractual arrangement setup by an Insolvency Practitioner between a company and its creditors. An arrangement lasts for a fixed term and ultimately results in debt write off on successful completion.

A CVA can be as flexible as a company’s own circumstances and can be based on surplus profits, release of capital, third party contributions or a combination of all of these.

In most circumstances, once a CVA is approved creditors are unable to charge interest and charges on the balance due to them. This is one of the main advantages of a CVA and helps stem the overall debt owed.

CVA’s are becoming an increasing popular tool in rescuing an insolvent company from a terminal insolvency procedure. Recent high profile cases include the rescues of JJB Sports and Portsmouth City Football Club Limited.

For more information about how CVA’s work and whether it is a viable option for you, contact us today for free no obligation advice.

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