case study - turnround practice

South African mining group

Stakeholder: group parent company.

Business: mining coal, gold and diamonds; international trading; distribution of consumables to the South African mining industry. Turnover - £80m per annum.

Objective: to stem the cash losses, rationalise the management information, manage the relationships with local lenders and advisers and support the UK group in refinancing the business.

Process: the first priority was to create processes for controlling and forecasting cash flows. Subsequently all businesses were reviewed and some closed as a result. Phase II centred on the management of the relations with 25 lending institutions and supporting the parent company board in considering alternative long term financing plans.

Outcome: the successful execution of a large scale rights issue.