|The Insolvency Act 2009
The Administration procedure was introduced in the Insolvency Act 2009 (proclaimed on 1 June 2009). Administration is designed to hold a business together while plans are formed, either to put in place a financial restructuring to rescue the company, or to sell the business and/or its assets, in order to produce a better result for the company’s creditors than would be obtained through a liquidation.
||Bringing a different perspective
This publication provides an overview of Voluntary Administration in Mauritius. Typical topics covered are the Voluntary Administration process, rescue solutions and possibilities for ending an Administration. It aslo includes a glossary of the main technical terms used in the Insolvency Act 2009.
The Insolvency Act 2009 provides a window of opportunity not only for creditors (secured or unsecured) but also for the directors to trigger the administration process with the objective for the company to continue its trading activities whilst re-organisation plans are being formulated with input from key stakeholders. Irrespective of the party who appoints an Administrator, the administration process aims to act in the interests of all the creditors. A moratorium is placed against a potential insolvency or legal proceedings against the company. Any pending winding-up petitions are suspended or dismissed. Administration can help to save jobs, deliver a better outcome for creditors, and secure new funding from new or existing investors. Ultimately, it can help towards the re-building of trust between its key stakeholders.
Who should go in Administration?
Administration can help companies burdened with debts or unfunded liabilities, particularly where the company is encountering significant difficulties in restructuring its affairs due to lack of cooperation from its creditors. The process can thus be considered as a protective measure from creditors.
Why go in Administration?
Administration offers an opportunity to bind all creditors to a restructuring plan. This enhances the economic value of the business in the long-run.
The end-result can be an improved outcome for the creditors compared to a liquidation process. However, the success of an Administration rests on the willingness of key creditors to accept potential waivers (or other restructuring options) on the amounts due to them.
What can PricewaterhouseCoopers do for you?
We were the first professional services provider in Mauritius to be appointed as an Administrator of a manufacturing concern under the Insolvency Act 2009.
We have an experienced team dedicated to Administration procedures with the knowledge and expertise (gathered from overseas and locally) to deliver a better outcome for all stakeholders.