Strategic Advisor to MZI Resources Refinancing, Restructuring and Business Sale
August 20, 2020
Strategic Advisor to MZI Resources Refinancing, Restructuring and Business SaleDownload Case Study
FTI Consulting provided strategic corporate advice to MZI Resources, an ASX listed mineral sands producer in WA. Our work helped to secure a funded runway for the business to explore a refinance and other strategic options, which ultimately supported a going concern sale to a mineral sands industry player..
MZI Resources (“MZI”) was underperforming on its production forecasts, largely due to poor mineral recoveries from its processing operations. Initially, the company sought assistance with a refinancing program, supported by its senior and subordinated lenders, and with the benefit of an updated Life-of-Mine plan.
Supporting and in conjunction with the refinancing initiatives, we identified a number of cost-saving and revenue improvement initiatives. These were subsequently embedded within the company’s revised business plan and updated Life-of-Mine economic model. We were also engaged to project-manage key business improvement initiatives, and to provide both short- and long-term cashflow modeling. The focus was to assist MZI’s board and management to develop an agreed plan with its financiers, who were owed a total of c.$165m.
As results failed to improve over the initial months, our role broadened to providing a strategic business review to the board. This became a key input to the board’s further engagement with financiers, resulting in their commitment to fund the business through an orderly sales process. We provided safe harbor advice to the board and remained heavily involved through to the successful conclusion of the sale.