Receivership

A form of bankruptcy wherein a court-named person, called a receiver, deals with the assets and affairs of a bankrupt business or estate.

Features

• The goal of a receivership is to return companies to profitability.
• A receivership is a court-designated device that can help creditors to recuperate funds in default and can assist troubled companies with staying away from bankruptcy.
• For the duration of a receivership, the company's chiefs stay in place (however they have little authority over the company).
• In a receivership, the court designates an independent "receiver" — or legal administrator — who really deals with all parts of a troubled company's business.