Keep or Sell the Healthcare Family Business: The Case of Promamec in Morocco
“At the end of the 1970s, the Moroccan corporatization policy led to a massive departure of expatriate specialists in the medical field [with dire consequences for patients]. Driven by a strong entrepreneurial ambition and after four years of experience in the field of medical devices, I seized the market opportunity by founding Promamec [in Casablanca, Morocco’s business capital] in the early 1980s,” said Mr. Abdelilah Lahlou.
This case depicts the fascinating success story of Promamec, a family-owned business and an unexpected healthcare champion, amid unprecedented business environment changes, in Morocco’s business capital, Casablanca. Known as one of the poorest Arab countries in the world, Morocco has become an emerging market that has attracted many foreign investors. Competition has intensified and financial resources have become more limited for Promamec. More specifically, the case draws attention to a crucial leadership transition between generations (2006) and a game-changing strategic decision (2018) to ensure future prosperity.
This success storycase brings together several business disciplines including, but not limited to, strategy and entrepreneurship. Until 2018, Promamec’s leadership created permanent value for more than three decades, growing organically at a double-digit rate in one of the most challenging business environments in the world. However, the son of the founder, who remains the major shareholder,must then makeis facing aa very challenging decision: keep the business (his father’s “baby” of his father) in the family or sell it to private investors?
• Identify and understand the opportunities and challenges associated with a family-owned health care business in an emerging market.
• Evaluate the impact of macroeconomic, political, regulatory, cultural, and personal factors on a fast-growing family-owned business.
• Assess the tangible and intangible resources that are necessary to create a sustainable competitive advantage, even against the odds in an emerging market where the business landscape shifts unpredictably (e.g., Arab Spring).
• Identify and understand the impact of key strategic decisions on a CEO’s career and reputation.