Company Voluntary Arrangement (“CVA”)
A CVA is a process where by an indebted company will try to reach an arrangement with its creditors to deal with its financial difficulties.
Often CVAs are run when the company is in administration but that is not always the case. If agreement can be reached between the company and enough of its creditors, the compromise arrangement will be binding upon all creditors, including those who do not agree with the proposals.
Although Scottish CVAs are relatively uncommon (when compared to other insolvency regimes) their importance should not be overlooked. They are often used in specific industries (for example football clubs and retail) and can also be an invaluable restructuring tool in other areas.
MacRoberts have advised in some of the most high profile CVAs in Scotland over the past few years and are very well placed to provide advice to creditors, lenders and directors in structuring any CVA proposals.