Assignment for the Benefit of Creditors (ABC)

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An ABC is a state-law alternative to federal bankruptcy that allows an insolvent company to wind down in a more efficient, less costly, and less disruptive manner. In this process, the company assigns all of its assets to a third-party fiduciary (the assignee), who then liquidates the assets and distributes the proceeds to creditors in order of legal priority.

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CMBG Advisors is a recognized leader in executing ABCs across a wide range of industries. With a deep understanding of statutory frameworks and stakeholder dynamics, we manage the process with discretion, speed, and strategic foresight. 

 

Our role includes overseeing asset disposition, communicating with creditors, managing claims, and providing clear reporting throughout. For owners and boards, an ABC offers closure with greater control and dignity than formal bankruptcy.

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Case Study: Technology Startup – 

ABC Wind-Down
 

A VC-backed SaaS platform with $25M in funding faced rapid cash burn and could not secure bridge financing. CMBG was appointed assignee and executed an ABC. We marketed and sold the core technology and customer contracts to a strategic buyer in under six weeks. Proceeds enabled partial repayment to unsecured creditors, and the process avoided the cost and delay of bankruptcy.

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