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Business Rescue

Business rescue and the practitioners tasked with managing it

Article provided by CIPC

Business rescue was created by the drafters of the Companies Act, 2008, largely in substitution of the concept of “judicial management” that was created in the 1926 Companies Act, as a means of assisting financially ailing companies.

Business rescue or corporate rescue refers to the restructuring or reorganization of a corporate entity. It is aimed at moving away from the culture of liquidation, and rather focusing on getting “financially distressed” entities back on their feet. 

Avoiding liquidation: what SMEs can do to prevent collapse

Article provided by Retail Capital

In the three months ended October 2020, there was a 33,2% rise in business liquidations, according to Stats SA. The implications are serious: not only do more employees lose their jobs, adding to the already sky-high 2,2 million people who have suffered at the hands of COVID-19, but there is a knock-on effect among those who they support, which in turn affects the economy as fewer consumers have the means with which to purchase goods and services. Add to this that SMEs contributed R2,3 trillion to the 2019 financial year and employ between 50% and 60% of the national workforce, it’s plain to see that liquidations are in no-one’s interest. So says Miguel da Silva, Retail Capital MD.

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