Author(s): Julizaerma Mohamad Khudzari, Norziana Lokman, Sarina Othman
A corporate voluntary arrangement (CVA) is a debtor-in-possession approach to rescue financially distressed companies. The introduction of a CVA into the corporate rescue mechanism of the Malaysian Companies Act 2016 appears to be a strategic option for a viable private company facing financial distress to have better debt negotiation for long term economic sustainability. This research reviews prior studies on the corporate rescue mechanism with specific reference to the CVA in Malaysia. A traditional desk-based research method was employed to review and evaluate existing investigations related to CVAs, and the appropriate comparison of advantages and limitations, similarities and differences of CVAs in Malaysia and in the UK were made. This study also offers suggestions for improvement in the CVA process and highlights areas for future research.