What options are available? Another option available to financially troubled companies is examinership.
Introduced by the Companies (Amendment) Act 1990, examinership enables companies to be placed under the protection of the court for a period of time, while the future prospects and viability are assessed. An Examiner, appointed by the court, will review the company’s affairs, consider its viability and if feasible, formulate proposals for the survival.
The process of appointing an Examiner
- a petition is presented to the High Court by the company, directors of the company, a creditor or a shareholder who has at least 10% voting rights at a general meeting;
- an independent accountant’s report is prepared outlining the current financial position and its prospect of survival; and
- if the court decides that there is a reasonable prospect of the company’s survival it will grant court protection for a period of three months. The possibility of an extension of not more than 30 days is provided for in the Act and the possibility of a further extension at the discretion of the court is provided for in the Act.
How can we help?
We can
- provide advice and assistance in preparing an application to the High Court for the appointment of an Examiner;
- prepare the independent accountant's report in support of a petition to the High Court for protection; and
- act as Examiner on the nomination of the shareholders, director or creditors.