Description
The Don Group: Bitter End to Suite Dreams?: Abstract
By January 2011, Thabiso Tlelai, chief executive officer (CEO) of The Don Group, South Africa’s largest all-suite hotel chain, knew he had to take drastic measures to save the company. With the 2008 economic recession impacting on tourist numbers to South Africa, and the 2010 FIFA World Cup™ increasing the number of well-funded competitors in the domestic hotel industry, The Don was struggling to register a profit and was getting deeper and deeper into debt. When Tlelai took over management of the group in 2001, he had dreamed of turning it into an international group of suite hotels. Now, he was on the verge of admitting that the dream was dead and was considering alternative strategies for the group that would still generate value for shareholders. Epilogue On 15 August 2013, The Don Group Ltd concluded the sale of the last of its hotels, effectively turning the group into a cash shell. The group delisted from the Johannesburg Stock Exchange Ltd on 15 February the following year. This was the result of a process that began in April 2011, when Thabiso Tlelai, CEO of The Don, and his directors embarked on a strategy of converting the group’s hotels to rental accommodation, with a view to selling the properties and thereby being able to pay off the group’s debt. This epilogue should be used in conjunction with the case with the same name.
Multi-part case
- The Don Group: Bitter End to Suite Dreams?
- The Don Group: Bitter End to Suite Hospitality? Epilogue
Teaching objectives
The overarching purpose of this case is to determine the problems of business which may serve as early warning indicators of possible business failure.
