DealMakers SA 2021 Awards | Nominees – Business Rescue Deal of the Year
The Ansarada DealMakers Annual Awards are just a few short weeks away. Take a look at those deals shortlisted for the Business Rescue Deal of the Year 2021.
This is the 2nd year in which this Gold Medal award is to be made. Nominations were received from advisory firms which together with nominations from the DealMakers editorial team were passed on to the Independent Selection Panel who produced a shortlist of four deals.
They are, in no particular order:
Consolidated Steel Industries (CSI)
The shutdown of the construction and steel fabrication industries, as a result of a slowing South African economy and the COVID-19 pandemic, created liquidity issues for CSI, a leading independent construction materials conglomerate. In July 2020 the company’s management and board took the decision to enter business rescue, the plan of which was adopted in September, having been approved by more than 98% of creditors present and voting. The speedy implementation of the business rescue plan ensured that there was a meaningful business, in the form of Global Roofing Solutions, a leading South African roofing material manufacturer, to present for sale to Rockwood Private Equity.
The local advisers were:
Engaged Business Turnaround, Deloitte Corporate Finance and Absa
Group Five
The group consisted of 179 companies across 38 countries when it commenced business rescue proceedings in March 2019, delisting from the JSE in June 2020. In June 2021, the business rescue practitioners released the latest status update report. The business rescue was large and complex and returning the entire group to solvency was not feasible given the depth of financial distress. Several subsidiary businesses required restructuring prior to disposal. The adoption of an integrated approach to the Implementations Plan has resulted in substantial returns in excess of liquidation being achieved and in most cases, creating sustainable value.
The local advisers were:
Metis Strategic Advisers, Birkett Stewart McHendrie, Werksmans, Cox Yeats, Allen & Overy, Webber Wentzel, Tiefenthaler, ENSafrica, Hogan Lovells, Van Wijk, Norton Rose Fulbright and Fasken
Afarak Mogale
Financially distressed, with cash flow shortages, the board of the ferrochrome producer Afarak Mogale placed it into business rescue in May 2020. All operations were placed into care and maintenance in late July 2020 owing to external logistical challenges, further cash shortages and the impact of the COVID-19 pandemic on the workforce. In September a business rescue plan was adopted by creditors outlining three possible restructuring options for the company. The sale of Mogale in July 2021 to ferrochrome producer Bright Minerals, for a transaction value of R300 million, marked the exit of the company from business rescue.
The local advisers were:
BDO Business Restructuring and Werksmans
Fairmount Zimbali Resort
The luxury five-star hotel owned by Kuwait-based IFA Hotels and Resorts was forced into administration in September 2020 after the COVID-19 pandemic severely curtailed the hospitality and tourism sector. Initially several large offers were made for the resort but as time progressed and the process unfolded, further impacted upon by the second COVID-19 wave, The Capital Apartments and Hotels stood out as the preferred bidder for the hotel situated on the Ballito coastline. The most pressing issue faced in the process was the securing of funding for the acquisition. In March 2021, The Capital reached an agreement to buy the property, in a deal that balanced the interest of all stakeholders.
The local advisers were:
Berrangè, Werksmans and Jones Lang LaSalle IP
Join the South African Mergers and Acquisitions industry on Tuesday 22 February 2022 as it celebrates the achievements of 2021.
For more information visit www.dealmakerssouthafrica.com/2021-awards
Or contact us at reception@gleason.co.za