The need for businesses rescue to combat extreme rise in liquidations

The need for businesses rescue to combat extreme rise in liquidations

Podcast

The need for businesses rescue to combat extreme rise in liquidations

Podcast

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Vincent explained that business rescue is a viable option for any South African company before it faces liquidation or when encountering financial distress. He outlined the initial steps of the process, highlighting the pivotal role of a business rescue practitioner (BRP) appointed to oversee the restructuring of the company's affairs, aiming to restore solvency.

Vincent underscored the inherent risks of the business rescue process, notably the necessity for cooperation among all stakeholders, including employees, creditors, and unions. He emphasised that without this collaboration, the effectiveness of business rescue efforts diminishes significantly, despite the broad powers vested in the BRP.

Furthermore, Vincent acknowledged the challenge of assessing a company's rescue viability. He recommended a preliminary evaluation, commonly referred to as a pre-assessment, as a prudent step before determining whether to initiate the business rescue process.