There are a number of ways in which a company may be wound up, one of which is a compulsory winding up. A compulsory winding up is where the company is wound up through a court process. However, the company may be of the view that the winding up proceeding was wrongfully initiated against them. This will have a grave impact not only on the company’s business but also the reputation of the company. Where the company is of the view that the winding up proceeding was wrongfully initiated against them and is desirous to resist the winding up proceedings, the company may consider filing for a Fortuna Injunction.
It is unsurprising that a company in dire financial state would have to eventually contend with the dilemma of whether or not to wind up the company. Fortunately, the Companies Act 2016 provides mechanisms by which a company in financial distress may employ to rescue the company from the jaws of winding-up.