MVL – Why Liquidate, My Company is Solvent?

A Members Voluntary Liquidation (“MVL”)

What is an MVL?

A Members Voluntary Liquidation, as the name suggests, is an exit strategy that gives owners of a Business the option to close a Business through choice. This form of Liquidation allows the distribution of assets to the Business’s shareholders in the most tax efficient manner possible.

The work to achieve this can be effected quickly and distributions made at a time to suit shareholders.

Liquidations Aren’t Always Bad

Firstly, let’s clear something up; in this context we are talking about Liquidation and not Insolvency, they are very different beasts. In fact for many shareholders, it offers a positive step forward and a way to make the most of your business’ assets. There are a number of reasons that you might choose to liquidate your company, such as:

• The Business has come to the end of its useful life
• The Business owner is retiring
• The Business might wish to manage a merger or demerger
• Implementing a group reorganisation or a simplification programme

My Company is Solvent, What Other Options Do I Have?

The key point here is that shareholders should remain open minded about the possibilities for a solvent business. If the Business has come to the end of its useful life, take your time, and consider your approach, the Parker Andrews team are here to help.

If you think an MVL could be an option and would like to discuss your options get in touch with us today.