Typically, we are appointed as receivers (also referred to as “receivers and managers”) of a company by a secured creditor (usually a bank) who has the power to make such an appointment.
As receivers, our duty is to take such steps as are necessary to have the secured creditors' debt repaid in full, or if not in full, then as much as is reasonably possible. This is usually achieved by selling the assets of the company for the best possible price. In many cases, the best possible price is obtained by trading on the company and selling all of its business assets as a going concern.
Once the secured creditor is repaid, or there are no more assets left to sell, then our role is at an end and we cease to act. The affairs of the company, and what remaining assets are left (if any), are passed back to the Directors, and their powers to manage the affairs of the company are reinstated. In other words, the company comes out of Receivership.
Sometimes we are appointed by the Court as receivers of a company. Such appointments are not common. In these cases, the court order will usually stipulate what our duties and obligations are to the various classes of creditors.
A company can enter into Voluntary Administration or Liquidation prior to, or during the course of the Receivership. In such cases, an independent person(s) would hold the office of Administrator or Liquidator.