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This term is applied to the winding-up of the affairs of a company when it ceases business. In most publicized instances it indicates bankruptcy, but it is equally applicable to the winding-up of a company by its shareholders when the purpose for which it was initially founded has been completed,

When a liquidation results from the effectual bankruptcy of a company the rules that apply are set out in the Companies Act. These rules differ according to whether the winding-up of the company’s affairs is instigated by shareholders or by creditors and, in the latter instance, whether it is voluntarily supported by the company, commanded by the court or conducted by the creditors under court supervision.

Reference: The Penguin Business Dictionary , 3rd edt.