Helical speed reduction gearbox H3 flender guss gmbh H3-CV-12B

Flender/Flender Gear Units/Helical speed reduction gearbox H3

ded to privatize Ingenio Victoria de Julio in order to improve the management and operations of the mill and reduce or eliminate the burden on Government resources. This section of the report describes the options and PW/IPG recommendations for successful privatization. . Privatization Objectives In determining privatization strategy, it is essential to address the objectives of the Government in pursuing privatization. The principal objectives of CORNAP in privatizing IVJ are as follows: 0 Reduce or eliminate government financial losses resulting from the negative cash flow of the mill and future government investment. 0 Transfer ownership of the mill as quickly as possible. 0 Improve management and operations of the mill. * Maintain employment at the mill. 0 Maximize the cash generated from the sale of IVJ. . Privatization Options The methods of privatization that have been used internationally can ba categorized as follows: * Public offering of shares * Sale of shares in the existing enterprise 0 Sale of enterprise assets for formation into new company * Infusion of new private investment (joint venture) 0 Breakup and liquidation of individual assets separately 0 Management/employee buyout * Management contract or lease Two of these options are not considered appropriate for the privatization of IVJ. public share offering is considered inappropriate due to the lack of an equity market in Nicaragua. Although public share offering would be possible, it would be extremely difficult and time consuming. sale of shares ini the existing enterprise is not considered feasible due to the large magnitude of IVJ liabilities. As noted in Section VII, IVJ is currently IX-1 operating at loss before debt service. Even if IVJ is able to improve operations and become profitable, its estimated value as an going concern is $9 to $2 million which is lower than the $4.0 million of liabilities on its balance sheet at February 2, 1. IVJ' stat