Page 3 - AMANGO MODEL ANSWER 2

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A. EXECUTIVE SUMMARY

A1. INTRODUCTION

This is an update on the initial report we presented to this Board in March 2017, in which we

reviewed the opportunities, threats, weaknesses and ethical dilemmas facing the group and provided
our strategic advice. We have now appraised the strategic developments (-including the embedded
ethical dilemmas as applicable) and today, we report back on our key findings and
recommendations.

A2. PRIORITISATION OF THE ISSUES

Taking account of the impact, urgency and the SWOT analysis (Appendix 1), we prioritised the main
issues as follows:

st
1 Priority: Synergy and Corporate Acquisition
We have received a potentially attractive 50% share-for-share offer from the London-listed Vedanta
Resources Group (VR), to acquire 60% of our business. This issue has some embedded ethical

dilemmas, yet, we need to decide as soon as possible whether to rebuff the offer or accept it. This is
the first priority because any delays may create panic and uncertainty in the market and damage our
value. Furthermore, it could determine whether or not, and how to proceed with our Corporate
nd
Reconstruction and Re-organisation –our 2 priority! This offer must be rejected -and a take-over
defense strategy activated immediately!

nd
2 Priority: Corporate Reconstruction and Re-organisation
The commodity and share price recovery -and our key disposals thus far, have helped us improve

our gearing significantly; so, the strategic rationale to proceed with our radical asset disposal
programme in order to pay down debt may longer be valid. We need to assess the prospects for our
restoration to investment grade in order to determine way forward. This is 2nd priority because our
strategic direction is the prism from which to evaluate all other strategic decisions! We recommend

you suspend the restructuring programme as soon as possible!

rd
3 Priority: Dividend, Finance and Investment Policy
The shift in our dividend policy from constant growth to payout ratio seems to be holding down our
value by as much as 34%; so we need to determine which dividend policy will best deliver on our

rd
long-term growth and shareholder value mandate. This is 3 priority because although it is a
discretionary matter and we have already communicated the new dividend policy to the markets, we
need to keep our shareholders happy, especially the PIC, in the event we need to activate a

Developed by The CharterQuest Institute for 'The CFO Business Case Study Competition 2017'
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