Grow or successfully disengage? Navigating the revolution of South African tower companies

Abstract

Subject area of the teaching case: The case is suitable for strategy or entrepreneurship modules. It is designed to teach students about the importance of implementing formal processes when entering a growth phase as well as the complexities, unexpected costs, and benefits that growing a business can bring. Student level: The case is aimed at MBA or Master-level students or executive education programmes as part of a strategy or entrepreneurship module. Brief overview of the teaching case: Lattice Towers is a South African company in the telecommunications infrastructure sector. They are struggling to generate sufficient cash flow to sustain operations as a result of poor strategic decision-making regarding tower-build site acquisition. To compound matters, the owner has been struggling with health issues related to the stress caused by the crises that Lattice Towers is going through. Recently, however, a multinational publicly listed behemoth in the telecommunications industry, Helios Towers, offered to acquire the company. The acquisition offer seems like a saving grace to the owner; however, Lattice Towers is deeply personal to the him and he would not like to lose the brand. Furthermore, there is a tremendous opportunity for business growth due to the imminent increase in demand for tower infrastructure. But based on the challenging financial position the business currently finds itself in, he might not have the option to keep the business. Expected learning outcomes: To develop a decision-making framework and strategy to navigate the business life-cycle stages, from survival to growth Understand the concepts of uncertainty, risk, and liquidity premiums that apply to entrepreneurship Understand the stress-related implications for entrepreneurs Understand the psychological costs and benefits of entrepreneurship Understand the personal financial implications for entrepreneurship