eCase Collection - abstracts
| HSE_CASE_NR: |
105-051
| status: active
|
|
| Title: |
MATHESON RESOURCES LIMITED:
A Split Decision |
|
Authors: |
Willock, John
Gasiorowska, Anna (supervisor)
|
| Material: |
15 pages |
| Publication year: |
2005
Language:
eng
|
| Keywords: |
Canada; divestiture; flowthrough; Gold exploration; gold mine; natural resources; oil; re-organization; separation; shares; strategy
|
| Abstract: |
Matheson is facing a problem with its structure. It is an exploration and development company
active in gold and oil & gas. During this time the market for natural resources commodities
heated up as prices rose, reflecting a decline in production and a weakening US dollar.
Demand for their output is putting a strain on management, who are beginning to feel they can
no longer finance both types of different businesses under one company effectively. They are
now considering a split into two separate public entities to manage and finance each resource
independently. In the Canadian market they are also presented with the added incentive to use
a unique “flow-through share” financing method that seems to make the split attractive. The
company must consider how it would organize its human resources and redistribute assets.
Government and shareholder approval would be required, and even then it may be a difficult
undertaking. Would they be wise to split from a strategic or financial point of view? |
Related teaching note:
| Publication year: |
2005
Language:
eng
|
|
ecch
Case is available from ecch case collection:
|
