On the road to becoming manager of finance business operations at Invicta Holdings, Odet Hayes went through many teachable moments at Edcon. The highlight of her time at the clothing retailer was working on the Edcon private equity deal when the company was delisted and taken over by Bain Capital LLC in 2007.
‘I was involved in providing information for the due diligence and remember thinking that the USD3.48 billion they were paying was too much,’ recalls Odet. ‘The lessons I learnt from that deal were two-fold. First, do not overpay for a business and secondly, be weary of being too leveraged especially when the debt is in foreign currency.’
The consequences of the mistakes made in the leveraged buyout were that the company had to have several bond restructures. This was exacerbated by the global financial crisis two years after the acquisition.
Job losses
‘A further lesson is knowing when to get out. I think Bain stayed too long, there was a window of opportunity to exit the ownership of the company and they didn’t take it; their projections were somewhat optimistic. By the time the COVID-19 pandemic struck, it was too late,’ Odet regrets.
In June 2020, Edcon served a jaw-dropping 22,000 employees with retrenchment notices. It was something that Odet agonised about for many weeks.
‘I really cried at that time because we had worked so hard to save the company. Having been at the company for many years, I got a decent severance package but the majority of my staff were not as fortunate. I helped as many of them as I could with referrals and references and I am glad many in the finance team found their feet after some time.’
Odet exercises the same duty of care to those that she manages at Invicta where she has been working since June 2021. She initially joined the company as a technical financial consultant head-hunted to assist with aligning their inventory measurement with the requirements of IFRS.
‘I was keen on the job because it aligned to what I really love which is fixing things that are broken. I do not do well in environments that are routine, where the tasks are boring and repetitive. I like to be uncomfortable because you learn a lot from your discomfort. It is for this reason that I always ensure each member of my staff has an improvement project alongside their regular duties.’
Management style
‘I believe I am a good instiller of knowledge. Say someone is responsible for monthly reconciliations, I ask them to walk me through the recon so that they fully understand why and how they do what they do rather than just do what has always been done. My style of management is interactive where I ask purposeful questions and allow the team to initiate ideas.’
Odet however admits that she is not always nurturing. ‘I know I can be hard sometimes. It often happens that someone is taking long to do something that I deem quite easy. I have to consciously remind myself that what is easy for me may be difficult for someone else. I try contain myself but it is difficult to do because my face always betrays my feelings.’
Asked to share a thought on something she recently learnt in IFRS, Odet cites the derecognition provisions of IFRS 9.
‘I recall when there was a debt restructure, the accountant simply debited the old loan and credited the new one. This may be wrong because you have to check the requirements in the standard relating to whether the old loan qualifies for derecognition. According to the standard, you need to test whether the terms of the new loan are substantially different from the old one in order to extinguish it. This is done by checking whether the present value of the new cash flows is different by at least 10% from the old one.’
ODET’S FAVOURITES:
Favourite car – My car; it’s my favourite because it is paid off! A very reliable 15-year-old Honda Accord.
Favourite restaurant – Any good Indian restaurant. I love spicy food.
Favourite hobby – Waking up as early as 4 am to cart my three daughters and their horses for horse shows. It brings me joy to see them do what they love.
Favourite meal – Depends on the season. I love curries but only in the winter. In the summer, I am happy to eat a salad.
Favourite movie – Shawshank Redemption. The story of determination, strategy and will to survive resonates with me.
Favourite App – Call of Duty Mobile. I have achieved legendary status and love that I compete against other gamers across the world and get to meet new people through the app.
Favourite holiday destination – Mauritius. I like that there is not much you can do on an island other than just sit and relax over a glass of wine on a boat. Holidays should not involve too much hustle and bustle.
