Where the core business of an insolvent company cannot be preserved, a company is likely to be placed in liquidation and its assets sold off. The proceeds of the sale are distributed to the company's creditors. Liquidation is almost always the end of the road for a company, and its name will eventually be removed from the companies register.
The liquidation of an insolvent company instigated by the directors is known as a Creditors Voluntary Liquidation
(CVL), and not by the creditors, as the name implies. Alternatively, the creditor's right of action is through the winding up petition presented to the Court; this is known as a Compulsory Liquidation
For a company which is solvent and wants to close down winding up all outstanding business affairs by paying creditors off in full and making a distribution to shareholders then a Members Voluntary Liquidation will be the most appropriate procedure.
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