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analysis valued this option at US$12,955. With our 51% valued at S$6909m, this raises the EV
of Strategy 1 to S$83,989m

Strategy 2: Stay the course

This presents similar considerations as the first except that we remain a 49% 'minority', do not
have to raise finance and face a different quantum of outcomes. Appendix 7 values the
dividends and hence our holding at S$90,985m. Furthermore there is an embedded put/sell

option for S$28,000m in 2018 valued at S$49m. This is quite interesting as it kicks in only after
we would have known whether Ilania has complied for sanctions to ease. The Decision tree

therefore shows that the 70% chance of compliance delivers S$90,985m with an EV of
S$63,690m meanwhile the 30% chance of non compliance allows us to 'Put' our 49% stake for
S$28,000m giving a discounted EV of S$6,352m. These combine with the optimistic chance to

give an EV of S$70,042m which when added to this Put Value of S$49m delivers S$70,098m as
overall EV.

Strategy 3: Sell-off & walk away

Offer 1 -Advantages:
 It is an outright cash offer of S$73,018m and could simply be used to pay the S$58,000m

Nakolia fine and remove the damage to our group capital structure and the balance
S$15,018m interestingly will just about compensate for the forfeit of the held-up 2014
dividends of S$4,210m + loan of S$5,800m and the 2015-recently declared dividend of

S$5,008m.
 It protects us from the ethical risks and legal uncertainties and liabilities that could flow from
the personal data violation case that is about to reach the courts.

Offer 1 -Disadvantages

 It undervalues our 49% holding by up to 25% (S$90,985m-73,018/73,018).
 Payment is by credit to our bank account in Ilania which still leaves us still with the challenge

of physically retrieving it for use.
 This offer is from Bartini who also competes with us in Africa and is also one of the 7 license

holders in Chininsia where we are bidding. We share very similar emerging market
ambitions so selling to them in the Middle East would be a strategic blunder as it would not
only see us capitulate on our Middle East ambition but it will actually embolden Bartini to

make even more aggressive strategic moves in our Sub Saharan Africa strongholds.

Developed by The CharterQuest Institute for 'The CFO Business Case Study Competition 2016'
www.charterquest.co.za | Email: thecfo@charterquest.co.za