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- Dictionaryliquidation/ˌlɪkwɪˈdeɪʃn/
noun
- 1. the process of liquidating a business: "the company went into liquidation"
- 2. the killing of someone, typically by violent means. informal
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LIQUIDATION definition: 1. the process of closing a business, so that its assets can be sold to pay its debts, or an…. Learn more.
- English (US)
a situation in which an asset is sold in order to get cash:...
- English (US)
- What Is Liquidation?
- How Liquidation Works
- Distribution of Assets During Liquidation
- Liquidation of Securities
- Example of Liquidation
- The Bottom Line
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Liquidation in finance and economics is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they are due. As company operations end, the remaining assets are used to pay creditors and shareholders, based on t...
Chapter 7 of the U.S. Bankruptcy Code governs liquidation proceedings. Solvent companies may also file for Chapter 7, but this is uncommon. Not all bankruptcies involve liquidation; Chapter 11, for example, involves rehabilitating the bankrupt company and restructuring its debts. In Chapter 11 bankruptcy, the company will continue to exist after an...
Assets are distributed based on the priority of various parties’ claims, with a trustee appointed by the U.S. Department of Justice overseeing the process. The most senior claims belong to secured creditorswho have collateral on loans to the business. These lenders will seize the collateral and sell it—often at a significant discount, due to the sh...
Liquidation can also refer to the act of exiting a securities position. In the simplest terms, this means selling the position for cash; another approach is to take an equal but opposite position in the same security—for example, by shortingthe same number of shares that make up a long position in a stock. A broker may forcibly liquidate a trader’s...
Company ABC has been in business for 10 years and has been generating profits throughout its run. In the last year, however, the business has struggled financially due to a downturn in the economy. It has reached a point where ABC can no longer pay any of its debts or cover any of its expenses, such as payments to its suppliers. ABC has decided tha...
When a company becomes insolvent, meaning that it can no longer meet its financial obligations, it undergoes liquidation. Liquidation is the process of closing a business and distributing its assets to claimants. The sale of assets is used to pay creditors and shareholders in the order of priority. Liquidation is also used to refer to the act of ex...
Liquidation is the process of ending a business and selling its assets to pay creditors and shareholders. Learn about the different types of liquidation, such as Chapter 7 bankruptcy, inventory liquidation, and securities liquidation, and see how they work in practice.
- Will Kenton
- 2 min
1. the process of realizing upon assets and of discharging liabilities in concluding the affairs of a business, estate, etc. 2. the process of converting securities or commodities into cash. 3. the state of being liquidated. an estate in liquidation.
The meaning of LIQUIDATE is to determine by agreement or by litigation the precise amount of (indebtedness, damages, or accounts). How to use liquidate in a sentence.
Liquidation is the process of converting assets into cash, terminating a business or estate, or destroying something. Learn more about the origin, usage and synonyms of liquidation from Dictionary.com.
Liquidation is the process of ending a company and distributing its assets and property. It can be compulsory (by court order) or voluntary (by shareholders' resolution), and it can involve different types of liquidators and creditors.
Liquidation is the process of closing a business or selling an asset to pay debts or get cash. Learn more about the meaning, synonyms, and usage of liquidation in business and finance contexts.
