Acrow Misr
Turnaround Case
Acrow Misr – Case Summary
Investment
- For over 30 years, ACROW MISR has been designing, developing, manufacturing and installing of formwork,
falsework, scaffolding and steel structure
- Sales were rapidly declining reaching EGP 22M
- Outdated know-how as parent company Acrow UK went bankrupt.
This rendered the company uncompetitive compared to its global peers (e.g. PERI Group)
Company was losing its competitive advantage
– the knowhow
– as well as cost competitiveness compared to its global peers
Approach
Boosted R&D through hiring 40 design engineers
− The company implemented a new strategy of growing the business by
− Expanding products portfolio
− Developing manufacturing capabilities
− Strengthening sales and marketing network
− Expanding geographic reach
A turnaround strategy focused on product innovation, diversification, and geographic expansion was developed and implemented
Results
- Acrow’s technologies are at the cutting edge of the industry
- Acrow became the biggest regional player
- Regional sales coverage now include Qatar, UAE, Kuwait, Algeria, Morocco, and Iraq
- Sales reached EGP 450M in 2014 and targeting EGP 600M in 2015.
Net income grew to EGP 70M
- Currently Acrow is penetrating African economies
- Gained market share and positioned to expand in African countries
- Improved brand & portfolio profitability
Lord International
International Expansion & Growth Case
Lord International– Case Summary
Investment
- A Wilkinson subsidiary, originally a manufacturer of wet shaving blades and razors since 1930.
- Retained losses reached over 50% of the paid in capital and the company was in a shutdown mode
- Production capacity was 250M blades per year
- Capacity utilization stood stale at 50% and losing market share to Gillette
- Salaries were not paid
The company was a bankrupt local player that accumulated retained losses and could not afford paying employees’ salaries
Approach
- Marketing acumen via diversifying products, offering a wide flexible spectrum of products for both genders including traditional double edge,single, twin, and triple blades systems, disposables, and shaving focused cosmetics.
- Capital was injected gradually
- Applying strictly adhered quality assurance processes.
- Continuously investing in quality & R&D.
- Sourcing raw materials from world class A manufacturers.
- Continuously producing on-going innovations to the market.
Marketing strategy focused on product diversification, pricing, and distribution channels enabled the firm’s market share growth
Results
- Considered one of the world’s top five razor blade manufacturers, with more than 3500 workers and employees.
- Capacity rose to 3Bn blades annually produced by four factories
- Capacity utilization is 100%
- Exports to more than 75 countries.
- Needed to expand & grow to more countries considering providing a convenient product catering for C class consumers.
- Provides relatively high-quality, adequate price wet-shaving solutions, with better value for money, for the targeted consumer segments
LORD furnishes its products at competitive rates, without trading off between price and quality,
and in parallel sustains high delivery punctuality
ICON Egypt
Distressed Case
ICON Egypt – Case Summary
Investment
- Established in 1977, ICON manufactures equipment and tools used in construction works including caravans, panels,
aluminum windows, and pipes
- 40% of publicly listed ICON was acquired in 2002
- The company was in a distressed situation as the debt level reached EGP 70M while sales stood still at EGP 12M
- Employees retention was a challenge leading to talent drain
A distressed case, ICON was not able to repay its debt obligations while still needing capital to grow.
It also failed to ingrain employees loyalty to the company
Approach
- Financial restructuring to keep healthy leverage and liquidity ratios
- Organization went through a restructuring apply best management practices
- Assess the organizational situation from all aspects including
− compensation,
− Reporting and authority matrix,
− Recruitment policies
− Current organizational inefficiencies
− A new organization structure and management procedures were effected
- Restructured the finances of the company to settle debt and finance growth
- Instilled new management practices to retain talent
Results
- Sales reached EGP 200M
- Operating income improved to EGP 20M
- The new recommendations facilitated reporting relations, better employee satisfaction, and realized cost savings to the organization.
- Expanded the lines of business into manufacturing pipes and warehousing and logistics with remarkable growth prospects
Substantial sales growth and diversification and margin improvements were realized as well increased employee satisfaction
and talent retention
Green Valley
Turnaround & Growth Case
Green Valley– Case Summary
Investment
- Green Valley is a peanut based snacks manufacturing company that needed to finance its growth
- The company possessed the manufacturing & managerial expertise but lacked the financial, marketing & operational resources to expand.
- There was a lack of marketing resources within the company.
- There was Insufficient financial capital for expansion.
- Insufficient working capital.
- Key people in leadership positions were needed.
- The company was financially distressed
Turnaround was needed to take the company to the next level
Approach
- Total turn around approach was devised.
- The board got restructured, along with a management overhaul.
- Banks relationships overhauled, debt was restructured & equity was raised
- Organization restructuring, along with hiring key personnel
- Establishment of a state-of-the-art facility to manufacture privately owned peanut based snacks brands (e.g.Krinko, Peanutcho)
- Addressed company financial and operational issues
- Transformed the business & made it well poised for success & growth through turnaround.
Results
- Injection of over EGP 90M in equity and quasi equity instruments from regional investors
- The turn around effected
- Growth plans were effected
- Shareholders base got diversified
- Introduction of the company’s own brands
- Top line growth and gaining market share
- Bottom line improvement due to cost restructuring and optimization
- IPO is expected in 2017
Positioning the company for growth & success, raising the needed finances for growth & making the company IPO ready.