liquidate

verb
liq·​ui·​date | \ˈli-kwə-ˌdāt \
liquidated; liquidating

Definition of liquidate 

transitive verb

1a(1) : to determine by agreement or by litigation the precise amount of (indebtedness, damages, or accounts)

(2) : to determine the liabilities (see liability sense 2) and apportion assets toward discharging the indebtedness of

b : to settle (a debt) by payment or other settlement liquidate a loan

2 archaic : to make clear

3 : to do away with especially by killing was hired to liquidate a certain businessman

4 : to convert (assets) into cash liquidated his securities

intransitive verb

1 : to liquidate debts, damages, or accounts

2 : to determine liabilities (see liability sense 2) and apportion assets toward discharging indebtedness

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Other Words from liquidate

liquidation \ ˌli-​kwə-​ˈdā-​shən \ noun

Examples of liquidate in a Sentence

The owners were ordered to liquidate the company and pay their creditors. The company is liquidating its assets. The owners were ordered to liquidate. The film is about a professional killer who's hired to liquidate a powerful businessman.
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Recent Examples on the Web

Blockbuster Alaska announced the closure of its two Anchorage stores, saying inventory will be liquidated through the months of July and August. Joel Shannon, USA TODAY, "Soon there will be only one Blockbuster video store left in the U.S.," 12 July 2018 If Theranos ends up being sold or liquidated, Holmes will not profit until more than $750 million is returned to allegedly defrauded investors and other shareholders. Beth Mole, Ars Technica, "Elizabeth Holmes announces brutal layoffs at Theranos following SEC settlement," 10 Apr. 2018 According to the bankruptcy court rules, a bad-loan resolution plan must be agreed within 270 days, failing which the company’s assets will be liquidated. Anto Antony, Bloomberg.com, "Banks Seek Wind Up of India Firms Owing $5.8 Billion," 4 Apr. 2018 If a company is liquidated in bankruptcy, the shareholders are entitled to whatever's left after all other stakeholders, including tax collectors, vendors and bondholders, are paid off. Michael Hiltzik, latimes.com, "The gun control issue is destroying the myth that 'shareholder value' is a corporation's only goal," 9 Mar. 2018 The case is expected to continue for several more years as the team liquidates the estate’s assets. Patrick Fitzgerald, WSJ, "Lehman Settles $1.2 Billion Derivatives Fight With Credit Suisse," 13 June 2018 The tax day theory goes like this: people needed to liquidate their bitcoin assets before the deadline in order to have enough dollars to pay their taxes; most have done this now, so goodbye sell-off. David Meyer, Fortune, "What's Behind Bitcoin's Recent Price Jump? It May Be Tax Day," 13 Apr. 2018 Marsh closed the O'Malia along with its store in Merchants Square last July when the grocer liquidated its remaining assets. Chris Sikich, Indianapolis Star, "Carmel seeks to solve surprising problem: city has no grocery stores on its east side," 5 July 2018 Board member Amy Ryder Wentz confirmed that the school would close June 30 and liquidate its assets, which include four Magnolia Drive properties in University Circle. Rachel Dissell, cleveland.com, "Montessori High School at University Circle slated to close," 10 May 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'liquidate.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of liquidate

circa 1575, in the meaning defined at transitive sense 1a(1)

History and Etymology for liquidate

Late Latin liquidatus, past participle of liquidare to melt, from Latin liquidus

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Statistics for liquidate

Last Updated

11 Nov 2018

Look-up Popularity

Time Traveler for liquidate

The first known use of liquidate was circa 1575

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More Definitions for liquidate

liquidate

verb

Financial Definition of liquidate

What It Is

In the financial world, to liquidate something means to sell it for cash. Although this sounds harmless, in the corporate world the term often carries a connotation of failure, because it is most often used in discussions about Chapter 7 -- a section of U.S. bankruptcy law under which companies and individuals liquidate their assets in order to repay their debts.

How It Works

Individuals, partnerships or corporations can liquidate assets. In the case of bankruptcy, when and how a borrower liquidates assets is a big deal. If all the debtor's assets are tax-exempt or subject to liens, there may not be any assets to liquidate and hence no money to distribute to creditors. If there are assets to liquidate, however, the creditors usually file a written claim so they can receive some of the proceeds. The trustee handles the liquidation and determines which creditors are paid first.

Why It Matters

The last step in the effort to repay debt in bankruptcy is usually to liquidate everything. However, the steps preceding liquidation usually involve bankruptcy, which -- at the individual level -- virtually ruins a person's credit for several years, making it very difficult and expensive to borrow money.

For businesses, liquidation usually means closing for good and selling off the assets. In the end, if a company's stock or bonds are deemed worthless by the bankruptcy court, investors might be able to deduct their losses on their tax returns.

Source: Investing Answers

liquidation

noun

Financial Definition of liquidation

What It Is

Liquidation refers to the selling of assets in return for cash.

How It Works

The term liquidation is most often used in discussions about Chapter 7 bankruptcy -- a section of U.S. bankruptcy law under which companies and individuals liquidate their assets in order to repay their debts.

Individuals, partnerships or corporations can liquidate assets. Here's how liquidation works in the case of bankruptcy.

Individuals
To file Chapter 7, the debtor files a petition with the local bankruptcy court. (In some cases, creditors can force a debtor into Chapter 7 by filing the petition themselves.) The debtor must provide the court with financial and tax information, as well as a list of creditors and outstanding debts. In most cases, the court also requires proof that the individual has obtained credit counseling. Filing the Chapter 7 petition automatically stops most collection actions against the debtor, including lawsuits, garnishments, and phone calls.

The U.S. trustee (or the court itself, in some states) then appoints an impartial trustee to handle the case and liquidate the debtor's assets. If all the debtor's assets are exempt or subject to liens, there may not be any assets to liquidate and hence no money to distribute to creditors. If there are assets to liquidate, however, the creditors usually file a written claim so that they can receive some of the proceeds. The trustee handles the liquidation and determines which creditors are paid first.

Ultimately, a judge decides whether to discharge an individual's debt. The judge can deny the discharge if the debtor failed to keep adequate records, failed to explain the loss of any assets, committed a crime, disobeyed court orders, or did not seek credit counseling. Alimony, child support, and student loans generally cannot be discharged in a Chapter 7 case, nor can most judgments against the debtor for criminal acts.

Businesses
The procedure for filing Chapter 7 bankruptcy is very similar for businesses. Public companies must also file a form 8-K with the SEC to notify shareholders of the bankruptcy proceedings.

Most companies do not file Chapter 7 until they've been unsuccessful with a Chapter 11 filing, which lets them attempt to restructure the company and restore the ability to service debt. In Chapter 7, a company ceases operations, and the appointed trustee liquidates the company's assets in order to repay its debts.

Lenders whose debt is backed by collateral are generally repaid first (via the receipt of the collateral), followed by the unsecured lenders and then the shareholders. In many cases, unsecured bondholders receive only pennies on the dollar. Shareholders almost never receive anything.

Why It Matters

Liquidation is usually the last step in the effort to repay debt. However, the steps preceding liquidation usually involve bankruptcy, which -- at the individual level -- virtually ruins a person's credit for several years, making it very difficult and expensive to borrow money in the future.

For businesses, liquidation usually means closing for good and selling off all the assets. In the end, if a company's stock or bonds are deemed worthless by the bankruptcy court, investors might be able to deduct their losses on their tax returns.

Source: Investing Answers

liquidate

verb

English Language Learners Definition of liquidate

business : to sell (a business, property, etc.) especially to pay off debt

: to pay all the money owed for (a debt)

: to destroy (something) or kill (someone)

liquidate

verb
liq·​ui·​date | \ˈli-kwə-ˌdāt \
liquidated; liquidating

Legal Definition of liquidate 

transitive verb

1 : to determine by agreement or litigation the precise amount of also : to settle (a debt) by payment or other adjustment

2a : to determine the liabilities and apportion the assets of especially in bankruptcy or dissolution liquidate a corporation — compare bankruptcy

b : to convert (as assets) into cash liquidate an estate

intransitive verb

: to liquidate something (as a corporation)

Other Words from liquidate

liquidation \ ˌli-​kwə-​ˈdā-​shən \ noun

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