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...O[{o0L66^> -SS (- ^¿/-(ji é HARVARD BUSINESS S C H O O L Xo\\3i*L ^ 9-201-082 REV: MARCH 4, 2002 The Loewen Group, Inc. (Abridged) In March 1999, John Lacey and the management team at the Loewen Group, Inc., had to decide what course of action to take in light of the company's imminent financial difñculties. On January 22,1999, Lacey, a renowned turnaround specialist, was appointed chairman of Loewen, the second largest death care company in North America. Headquartered in Burnaby, British Columbia, Loewen owned over 1,100 funeral homes and more than 400 cemeteries in the U.S. and Canadá; it also owned 32 funeral homes in the United Kingdom. The company had come a long way since its modest beginnings in Canadá, where Ray Loewen, the founder (and, until recently, chairman and CEO), started out helpinghis father run the family funeral business in the late 1950s. During the last two decades, Loewen Group had grown explosively, mainly by acquiring small independent funeral homes and cemeteries in densely populated urban markets; in recent years the company had also acquired several large established funeral chains. Over the last five years alone, Consolidated revenues had grown by nearly 30 percent a year, on average, from $303 million to over $1.1 billion. Despite its impressive growth, the company faced a major financial crisis. It lost $599 million for 1998, compared to earning $43 million the previous year. Loewen's on-going acquisitions...
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