Types of liquidation

According to the purpose of liquidation

material liquidation

The material liquidation in which an acquisition company becomes a winding-up company when the dissolution of the company is entered in the commercial register. This then bears the addition (i. L.) in addition to the name of the company. After the company's economic activity has ceased, the assets are sold and the capital contributions are repaid.

formal liquidation

 The formal liquidation, in which the company also goes under in its previous legal form, but continues its gainful activity in a new legal form, to which the assets are transferred in detail.

According to the extent of the liquidation

Total liquidation

The total liquidation, which refers to the entire assets of the company. Formally, it consists of the transfer of assets and debts to a new legal form of the company by way of individual legal succession.

Partial liquidation

The partial liquidation, which does not affect the entire assets of the company, but only parts of them. It takes place voluntarily through a shareholder resolution, compulsorily through the assertion of security interests demanded by creditors. As a rule, it leads to a restriction of the company's economic activity without changing its legal continuity.

Finally, a distinction can be made between voluntary liquidation by resolution of the shareholders and compulsory liquidation by opening bankruptcy proceedings.

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