Liquidation

RECENT NEWS
Wall Street Journal  May 10  Comment 
No one offered to rescue the struggling Betsey Johnson retail chain at a last-ditch auction, leaving most of the fashion designer's 63 stores to liquidate.
The Hindu Business Line  May 8  Comment 
The pepper market on Tuesday dropped on bearish sentiments, liquidation fears and limited activities. Prices of all the active contracts declined. Investors were said to be planning to l...
The Hindu Business Line  May 4  Comment 
The pepper market on Friday witnessed high volatility throughout the day and all the active contracts ended far below the previous day's closing following imposition of a series of measures by the...
The Hindu Business Line  Apr 26  Comment 
Infrastructure companies with interests in toll road projects may have cause for cheer. This is because the Corporate Affairs Ministry has now allowed them to adopt revenue-based amortis...
Cellular News  Apr 25  Comment 
Nigeria's Senate has opposed plans to liquidate the state-owned telecom network, Nitel following repeated failures to privatise the company. Click here for more.
Wall Street Journal  Apr 19  Comment 
A judge in the Cayman Islands ordered the liquidation of a hedge fund run by Fletcher Asset Management after three Louisiana public pension funds told the court they weren't able to withdraw their money.
Business Wire  Apr 14  Comment 
On Friday, April 13, 2012, on behalf of Irving H. Picard, the SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), Counsel to the Trustee filed the following with the District Court for the Southern District of New
Sydney Morning Herald  Mar 23  Comment 
Air Australia creditors have voted unanimously to put the company into liquidation.
The Australian  Mar 23  Comment 
Business Times - Singapore  Mar 21  Comment 
TWO Lehman Brothers entities - which still have cash on their books - were placed under voluntary liquidation yesterday, though minibond investors here cannot launch claims against them as creditors.
The Hindu Business Line  Mar 21  Comment 
Pepper continued to head south on Wednesday on liquidation and bearish sentiments created by reports of selling pressure in Karnataka. Some of the dealers were liquidating because of the...




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Business Liquidation

The process of selling assets for cash.

This situation generally arises when a company can no longer carry out it's business as intended, by making profits and, share holders do not have any chance of gaining from investing in the company.

The cash generated out of liquidation is usually spent on reducing debts that company own to its lenders.

For example, Lehman Brothers filed for Chapter 11 bankruptcy protection on September 15, 2008 and now in Jan 2009, Barclay's [which took over Lehman, LEHMQ:US] is in the process of liquidating it, though Lehman has a couple of trillion dollars in assets.

Winding up would mean liquidating the assets of a corporation or partnership, settling accounts, paying bills, distributing remaining assets to shareholders or partners, and then dissolving the business. Winding up a non-profit corporation requires a plan for distribution of assets to some charitable or other non-profit entity. [1]

Investors Liquidation

Liquidation is the conversion of assets into cash by an Investor getting rid of a position in a particular type of security. [1] When Investors convert assets into cash for there own personal accounts, they may have no reason too convert, and may spend the proceeds on whatever they want, whenever they want.

Liquidation is simply the conversion of assets into cash, liquidity refers to how quickly you can convert your assets into cash. [2] For example, a portfolio manager might decide to liquidate a position in a stock by selling all the shares of that stock held in the portfolio. [3]

c.1575, "to reduce to order, to set out clearly," sense of "clear away" (a debt) first recorded 1755. The meaning "wipe out, kill" is from 1924. [2]

References

  1. Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott Accounting Professor ISBN-10: 0618176519 pg 212
  2. Stock Investing for Dummies‬ By Paul Mladjenovic pg22 ISBN-10: 0470401141
  3. Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. ISBN-10: 0618176519 pg212
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