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When a turnaround is not possible, we can clarify available options, minimise loss exposure, and maximise returns to stakeholders on insolvency. Our partners may assume the role of Liquidator or Receiver, or we may act in an advisory capacity to creditors, company directors or other stakeholders.
Liquidations
PricewaterhouseCoopers is known for being the liquidators of some of Hong Kong's largest and most complex corporate liquidations. Think Peregrine. CA Pacific. HIH Insurance. Charles Schmidt & Associates. We were sought out and appointed for these and other large and complex liquidations for a number of reasons including:
- The depth and breadth of experience of our insolvency team. We have one of the largest and most experienced dedicated insolvency teams in Hong Kong and as a result have the ability to draw on specialist resources from within the firm to mobilise the right experts to manage insolvencies from the initial crisis situation through to completion of distribution of assets to creditors.
- The industry specialists we can draw upon from our other service lines to ensure an efficient understanding of complex issues. By utilising specialists resources from our other service lines to, for example, help unravel a complex derivatives transaction, we can operate more efficiently thus helping to increase recoveries to stakeholders.
- The approach we take. We are valued by our clients for our ability to rapidly identify problem areas, gain cooperation and build consensus, develop value-preserving solutions, and implement them with sensitivity and precision. In our experience, stakeholders need the fullest possible communication throughout a liquidation process. We strive to achieve this and make every effort to draw from management's expertise where possible and to work in consultation with creditors to deliver solutions that reflect the wishes of the stakeholders.
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Solvent Liquidations
Hong Kong: There are often sound business reasons why all or part of a business should be wound up even though the companies concerned remain solvent. PricewaterhouseCoopers is able to advise and help companies prepare for a solvent voluntary liquidation. Our partners have extensive experience in acting as liquidators in a wide spectrum of members' voluntary winding ups with different levels of complexity, ranging from dormant companies to corporations with ongoing operations and substantial assets. We also advise multinational corporations on corporate simplification programme the main objective of which is to assist them streamline their corporate structure and save future costs by doing so.
In addition to Hong Kong incorporated companies, we assist clients in the winding up of overseas companies, including those incorporated in the British Virgin Islands, Caymans Islands, Bermuda, and other jurisdictions. We can also help clients make an application to the Companies Registrar for the deregistration of Hong Kong companies and overseas companies with a place of business in Hong Kong registered under Part XI of the Companies Ordinance.
China: In China, where the solvent liquidation process for foreign investment enterprises is dictated by a series of government approval and foreign exchange controls, we have extensive experience in advising and assisting multinational corporations to wind down and liquidate their Chinese investments. Our roles have involved acting as member of the liquidation committee, arranging for the termination of employees, realising fixed and movable assets, commencing litigation against delinquent debtors and obtaining the requisite approvals from various government departments including the tax clearances required for de-registration.
Our experience indicates that it takes more than just knowledge of the documents and regulations to implement a liquidation successfully. Equally critical is first-hand experience on local practices and availability of local resources to conduct the considerable on-the-ground activities that are required. Given PwC's extensive China network and experience, we are well positioned to help clients navigate through the difficult path of administrative procedures and controls required to achieve a successful solvent liquidation in China.
Estate administration
The administration of a deceased's estate can be a challenging and complex job, particularly if the deceased has accumulated substantial assets in his lifetime. It is not uncommon for disputes and litigation to arise between beneficiaries relating to the administration and distribution of an estate in Hong Kong. Whether appointed by the Court, the estate's personal representative or a beneficiary of the estate, PwC provides value added assistance to help deal with and overcome these challenges.
When disputes arise, we generally assume the role of independent Administrators of a deceased's estate or act in an advisory capacity to the personal representative to, or a beneficiary of, the deceased's estate. As Administrators, our partners assume control of and manage the estate's assets until such time the disputes are resolved or the estate's assets are distributed in accordance with settlement terms or a Court Order. Our role in such situations may extend to managing the various business entities entrusted to the estate with a view of ensuring that the value of these entities is preserved. We also act in an advisory capacity to either the personal representative of the deceased's estate or one of its beneficiaries. For instance, an estate may have numerous assets and businesses that need managing pending resolution of a dispute. We will advise the estate's personal representative on appropriate strategies for managing the Estate's assets within the framework of his legal duties to the beneficiaries. Alternatively, we may assist the personal representative to summarise and report on the Estate's assets, either at a specific point in time or over many years. We may also review and critique such reports for beneficiaries.
Disputes between beneficiaries on estate matters can be emotionally-charged. As third party professionals, we help draw clarity to the issues in a rational manner and strive to help resolve any disputes in an expeditious manner.
Receiverships
Where a debenture holder wishes to enforce its security, receivership is often an effective alternative to liquidating the company and assets are more likely to realise a higher value while the business continues in the interim. Under a receivership, an individual is appointed to run the business until the security under the fixed or floating charge is realised. Our partners appointed as receivers (either privately or by court appointment) set maximising the asset realisations as a prime objective. At the same time, we seek, if possible, to keep the business operational as a going concern. Our receivership services cover both real estate property and non-property assets.
Schemes of Arrangement
A scheme of arrangement is a statutory mechanism for a contractual arrangement between a company and its creditors that enables a restructuring of debt or a binding compromise to be put in place which is agreed by way of resolutions passed at meetings of classes of creditors. Schemes of arrangement can be used in conjunction with a debt restructuring or a liquidation. Our partners have put together some of the more complicated Schemes seen in Hong Kong in recent years and are thus fully able to advise on all aspects of schemes and act as a scheme administrator.
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