Restructuring of Shield Medical (Pvt.) Ltd

The Shield Medical (Pvt.) Ltd. is a trading Company dealing with medical and surgical items and supply to local hospitals both in the Government and private sectors.  They have been one of the leading trading Companies doing very well but due to mismanagement and unprecedented competition in the market, they have been little by little pushed towards loss of business and funding constraints to execute their orders in hand.  They were looking for an investor to either acquire fully or a merger.  They approached the IRC (Pvt.) Ltd at the right time and we took over the Company to restructure it to an acceptable and manageable level for acquisition or a merger.

We located Lalan Rubbers (Pvt.) Ltd., a Company manufacturing medical gloves and other rubber products for export and local distribution.   Since it is a related enterprise to Shield Medical products, we initiated negotiation with them.  Lalan Rubbers Management has been very keen in investing in Shield Medicals  but on the basis of a bailing out process by absorbing all the liabilities on the Company and infuse working capital on a staggered basis to meet the execution of the orders in hand, so that by making use of the staff and other resources available with Shield Medicals, all recurrent expenditures could be met from the profits earned from those orders and the rest to be used to refinance the business.  It is a process of ‘earn and pay’.  Another instalment of capital infusion would be made after a period of time to enhance the economic efficiency of the Company and to expand the business on new product lines to meet the new challenges in the market in order to have a competitive edge over the potential competitors in the market.  

The restructuring process will continue until the whole transactions are complete and the  Shield Medical (Pvt.) Ltd. acquired in full.

We recommended no staff retrenchment as every one in the staff has a special area of activity in the  Company, with which the  new Management finds it easier to continue with business strategic inputs without disturbing the organizational behaviour and culture  of the  staff without adding new human resources unless it is inevitable.

The IRC (Pvt.) Ltd. is expected to continue its supervisory and consultancy activities for some time until the new management has no issues as such that may derail the smooth progress that is taking place at the moment (March, 2018)

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