McDonald Vague has put together a large number of successful creditor compromises/proposals. These can be entered into by either companies or individuals. The advantage for the debtor is that they can avoid bankruptcy or liquidation. The advantage for creditors is that they expect to receive a better outcome than they would in a formal insolvency. If creditors do not consider this likely, they will vote against the proposal.
The key ingredient of a successful compromise or proposal is therefore a credible and achievable plan to sell assets or for a third party to inject funds, resulting in more for creditors than in a formal insolvency. We have significant experience in identifying those situations where a compromise or proposal is likely to work. If we do not think it is likely to succeed, we will suggest an alternative course of action.
Compromises are popular for companies which wish to continue in business, and proposals have proved popular with individuals seeking to avoid the stigma and restrictions of bankruptcy. For further details on the processes involved, please read our article regarding company compromises or our article regarding personal insolvency.
To discuss whether a compromise or proposal may work for you, please contact Peri Finnigan. Our advice is provided on a confidential basis and does not commit you to appointing us in any formal capacity.