scholarly journals SMU Group’s complex corporate restructuring

2020 ◽  
Vol 27 (2) ◽  
Author(s):  
Francisco Esteban Sanchez ◽  
Juan Pablo Torres ◽  
María Francesca Parra ◽  
Slavna Pavlov de la Fuente
Keyword(s):  
Corporate Restructuring ◽  
Operational Performance ◽  
Corporate Value ◽  
Rating Agencies ◽  
Financial Position ◽  
Future Performance ◽  
Management Capacity ◽  
Supermarket Industry ◽  
Group A ◽  
Restructuring Process

This case examines the corporate restructuring process of SMU Group, a Chilean retail supermarket chain. The restructuring process was triggered by an internal situation involving operational inefficiencies between the years 2007 and 2012, following an aggressive acquisition process. These problems were the result of an aggressive “Buy-and-Build” strategy, thanks to which by the end of 2012 the Group had grown to become the third largest player in the supermarket industry in Chile. Although this strategy allowed the conglomerate to consolidate its competitive position, it was based on inorganic growth that hid the differences in the operational performance of the different chains and did not allow the Group to take advantage of its own synergies in the process of consolidating the holding company. Around mid-2013, this lack of definition in SMU's competitive strategy resulted in a serious deterioration of its financial position, due to the significant indebtedness taken on to finance acquisitions, as well as the insufficient generation of cash flow. Furthermore, when compared to the two main players in the industry, SMU showed lower levels of profitability and sales per square meter. To overcome this crisis, SMU implemented a three-year strategic plan (2014-2016), reinforcing three fundamental areas: finance, operations and commercial. The goal was to restore financial viability to the conglomerate by the end of 2016. After executing its plan, SMU achieved an improvement at the operational and commercial levels. However, in the first months of 2017, the risk rating agencies still had doubts about SMU's future performance and its crisis management capacity. For this reason, Álvaro Saieh, who was serving at the time as Chairman of the Company's Board of Directors, had several questions: could SMU's 3-year operational and strategic restructuring plan be considered successful? what are the critical variables that will ensure the sustainability of the company and its growth in the coming years? will I be questioned again like I was in 2013? and finally, what possibilities do I have to create corporate value in the future?

Mahut Group: A Failed Case of Organizational Restructuring

2005 ◽  
Vol 09 (01) ◽  
pp. 1-23
Author(s):  
Ashok Som
Keyword(s):  
Production Capacity ◽  
Cement Industry ◽  
Top Management ◽  
Organizational Restructuring ◽  
Price Wars ◽  
The Face ◽  
Group A ◽  
Restructuring Process ◽  
Fierce Competition

Mahut Group (name disguised) was a family-owned business group that operated two cement companies, Heera and Moti (names disguised), in Gujarat, the Western part of India. Heera Cement had been making substantial losses since its inception and was currently under the consideration of Board of Industrial & Financial Reconstruction (BIFR). Moti Cement was also a loss-making company but the losses were not as substantial as that of Heera. Each of the cement companies, Heera and Moti, had a production capacity of 1.2 million tons of cement per annum. The Mahut Cement Group had about 1000 employees, out of which about 30 personnel were in the top management. As of 1999, both the cement companies competed with each other in addition to competing with other cement players operating in Gujarat. The cement industry was deregulated in India in the late 1980's which resulted in fierce competition and price wars among the cement firms. In the face of this fierce competition, the Group decided on a restructuring process, and hired an American consulting firm, in 1998, to find a "synergy" between the two companies, Heera and Moti, and help the two companies to turnaround. This case discusses the issues of the restructuring process and the various interventions undertaken by the top management of Mahut Group. The case discusses the recommendations of the consultant and the role of human resource management during the restructuring process.

Intangible Assets

2011 ◽  
pp. 110-124 ◽  
Author(s):  
Feng Gu ◽  
Baruch Lev
Keyword(s):  
Information Technology ◽  
Intangible Assets ◽  
Balance Sheet ◽  
Intangible Capital ◽  
Economic Approach ◽  
Corporate Value ◽  
Future Performance

This chapter develops an economic approach to estimating the value of intangible assets that are not recorded on the firm’s balance sheet. The authors demonstrate that their approach provides economically meaningful and useful estimates for the value of intangible assets. Their results indicate that investments in R&D, advertising, brands, and information technology are important drivers of intangible capital, and in turn corporate value. Their approach is shown to be useful to investors seeking information on future performance of intangible-intensive firms. They document evidence that the intangibles-based measures can effectively distinguish between overvalued and undervalued stocks. They believe the intangibles measures described here can add an essential, and hitherto missing, valuation tool for managers and investors concerned with intangible assets.

scholarly journals Development of selected financial indicators for agricultural enterprises in the Slovak Republic

2012 ◽  
Vol 50 (No. 3) ◽  
pp. 120-124
Author(s):  
Z. Chrastinová
Keyword(s):  
Economic Reform ◽  
Slovak Republic ◽  
Early Years ◽  
Agricultural Products ◽  
Financial Indicators ◽  
Agricultural Enterprises ◽  
Entire Process ◽  
Financial Position ◽  
Fixed Assets ◽  
Restructuring Process

Except of 2001 and 2002, the agriculture has produced losses of SKK 38.8 billion over the entire process of transformation. The losses in agriculture were caused by major disparities between the price of supplies to agriculture and prices of agricultural products, plus the restrictive subsidy and loan policy adopted in the early years of the economic reform. The economic situation has improved over the last two years. This was caused by the increase in subsidies, as well as by the continuing restructuring process (sales and liquidation of dubious assets, optimised production), reduction in numbers of loss-making enterprises, by growth and increase in efficiency of production and due to a substantial increase in earnings of many partnerships. However, even despite the positive trends current financial position of most agricultural enterprises does not meet the requirements for development in agriculture, with the rate of TFA (tangible fixed assets) depreciation achieving 50% (of that, depreciation of machinery stands at 70%). The earnings are moderate even in profit making enterprises, with 75% of those enterprises making only up to SKK 1.5 million in earnings. 

scholarly journals Succession, performance and management capacity in family companies

2019 ◽  
Vol 17 (2) ◽  
Author(s):  
Luis Améstica-Rivas ◽  
Andrea King-Domínguez ◽  
Camilo Larraín Jara ◽  
Yesenia Parra Molina
Keyword(s):  
Family Businesses ◽  
Cronbach Alpha ◽  
Three Generations ◽  
Future Performance ◽  
Management Capacity ◽  
Emotional Capital

This study analyzes the perceptions of the owners and/or managers of family businesses in the Ñuble territory of Chile, according to the dimensions of succession, performance and managerial capacity. Methodologically, hierarchical conglomerate analysis was used, obtaining a Cronbach alpha of 0.789. Three generations stand out: first (47.6%), second (38.1%) and third (14.3%), where the managerial capacity is determinant in the sustainability. There are problems in the succession for lack of planning of the process and the potential successors do not wish to continue with the company given their interests and levels of professionalization. Future performance is related to emotional capital and the degree of innovation.RESUMENEste estudio analiza las percepciones de los dueños y/o gestores de empresas familiares del territorio Ñuble de Chile, según las dimensiones sucesión, desempeño y capacidad gerencial. Metodológicamente se utilizó análisis de conglomerado jerárquico, obteniéndose un alfa de cronbach de 0,789. Destacan tres generaciones: primera (47,6%), segunda (38,1%) y tercera (14,3%), donde la capacidad gerencial es determinante en la sustentabilidad, hay problemas en la sucesión por falta de planificación del proceso y los potenciales sucesores no desean continuar con la empresa dado sus intereses y niveles de profesionalización. El desempeño futuro está relacionado al capital emocional y el grado de innovación.RESUMOEste estudo analisa as percepções dos proprietários e/ou gerentes de empresas familiares no território Ñuble do Chile, de acordo com as dimensões de sucessão, desempenho e capacidade gerencial. Metodologicamente, foi utilizada a análise hierárquica de agrupamento, obtendo-se um alfa de Cronbach de 0,789. Destacam-se três gerações: primeira (47,6%), segunda (38,1%) e terceira (14,3%), onde a capacidade gerencial é determinante na sustentabilidade. Há problemas na sucessão por falta de planejamento do processo e os potenciais sucessores não desejam continuar com a empresa devido aos seus interesses e níveis de profissionalização. O desempenho futuro está relacionado com o capital emocional e o grau de inovação.

scholarly journals Financial Forecasting in Financial Management Strategy: Goals, Objectives, Methods

2021 ◽  
pp. 56-58
Author(s):  
Aleksandra Vitalevna Kulakova
Keyword(s):  
Financial Management ◽  
Management Strategy ◽  
Financial Forecasting ◽  
Management Decisions ◽  
Financial Position ◽  
Managerial Decisions ◽  
Future Performance ◽  
The Future ◽  
The Right

The activity of the enterprise is inseparable from the adoption of managerial decisions. Forecasting is one of the tools that helps management to assess the future performance. Financial forecasting plays a key role in the development of a company's strategy and is an integral part of financial management. This article discusses the tasks and methods of financial forecasting, as well as the factors on the basis of which the choice of forecasting methodology is made for a successful assessment of the financial position of an enterprise and making the right management decisions.

scholarly journals The concept of the system approach of the enterprise restructuring process

2019 ◽  
Vol 2 (4) ◽  
pp. 46-70 ◽  
Author(s):  
Henryk Dzwigol
Keyword(s):  
Knowledge Management ◽  
Strategic Management ◽  
System Approach ◽  
Corporate Restructuring ◽  
Management Model ◽  
Enterprise Restructuring ◽  
Knowledge Based ◽  
Restructuring Process

The article presents methodical requirements for the restructuring programme in the context of strategic management and the shaping of strategic forms. The author described the corporate restructuring model as a basis for transformations designed to achieve a knowledge-based organisation. The author attempted to address the following question: How should the knowledge management model be perceived in modern companies? Furthermore, the importance of organisational forms in the corporate restructuring process was underlined. The restructuring process should be carried out on the basis of specific restructuring objectives resulting from the scope of changes.

scholarly journals STRATEGIC SOLUTIONS FOR CORPORATE RESTRUCTURING

2004 ◽  
Vol 8 (1) ◽  
pp. 45-55 ◽  
Author(s):  
Juozas Bivainis ◽  
Andrius Tamošiūnas
Keyword(s):  
Strategic Management ◽  
Corporate Restructuring ◽  
Human Potential ◽  
Corporate Management ◽  
Financial Assets ◽  
Process Use ◽  
Restructuring Process ◽  
Management Functions

The paper analyses solutions of corporate restructuring, specifying the techniques of their application in the context of improvement of strategic management, rationalization of corporate management functions as well as measures to control the restructuring process. The benefit of application of the proposed corporate restructuring solutions is revealed. Greater possibilities to rationalize the restructuring process, use of human potential, material and financial assets, other relevant strategic corporate property, to develop resources of an enterprise and thus to reach greater competitiveness of enterprises are created.

Corporate management in receivership: the case of Uchumi supermarkets

2014 ◽  
Vol 4 (2) ◽  
pp. 1-16
Author(s):  
David Mathuva
Keyword(s):  
Subject Area ◽  
Corporate Restructuring ◽  
Management Style ◽  
Corporate Management ◽  
Content Type ◽  
Corporate Managers ◽  
Before And After ◽  
Restructuring Process ◽  
A Company

Subject area – Strategic Management and Corporate Finance. Study level/applicability – Higher undergraduate and graduate levels. Case overview – The case demonstrates how a company can be able to manage corporate restructuring successfully and recover from receivership. Uchumi is a company incorporated in Kenya and listed on the Nairobi Securities Exchange (NSE). The case examines how Uchumi successfully recovered from receivership in 2006 owing to previous mismanagement and regained profitability after years of continued losses. A review of the company's management style and the role of the management in turning around the company are presented. Expected learning outcomes – The case demonstrates how financially and operationally troubled corporations can be managed effectively, illustrates how corporate managers can manage corporate restructuring and receivership successfully, shows the applicability of Kotter's eight stages of leading changes successfully and other leadership approaches/theories and demonstrates the differences between the performance of a corporation before and after the restructuring process. Supplementary materials – Teaching notes are available for educators only. Please contact your library to gain login details or email: [email protected] to request Teaching notes.

Bankruptcies, bailouts, and some political economy of corporate reorganization

2018 ◽  
Vol 14 (5) ◽  
pp. 833-851 ◽  
Author(s):  
DYLAN DELLISANTI ◽  
RICHARD E. WAGNER
Keyword(s):  
Political Economy ◽  
Corporate Governance ◽  
Corporate Restructuring ◽  
Standard Approach ◽  
Discovery Process ◽  
Financial Industry ◽  
Corporate Reorganization ◽  
Entrepreneurial Discovery ◽  
Restructuring Process ◽  
Enterprise Level

AbstractBankruptcy has long been the standard approach to reorganizing failing corporate entities. In recent years, bailout, whereby a governmental entity takes charge of the reorganization, has appeared as an alternative. At the enterprise level, there is a Coase-like invariance proposition at work in which a failing concern is replaced by a going concern under either process. Significant differences arise once we move beyond the point of reorganization. The choice between bankruptcy and bailout is fundamentally a choice between alternative arrangements for corporate governance, and not about transforming failing concerns into going concerns because this will happen under either arrangement. We argue that political entanglement in corporate restructuring will tend to preclude the entrepreneurial discovery process. We recount the recent American auto and financial industry bailouts, highlighting how each episode was guided by political considerations, which served to distract the restructuring process from discovering those opportunities that market-based restructuring would have discovered.

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