Case study: Large heavy metal engineering company

The issue

The client, a large heavy metal engineering enterprise, was considering the acquisition of a competing company. PricewaterhouseCoopers was asked to determine whether there were any material environmental issues that might affect the financial performance or value of the target company.

Our approach

PricewaterhouseCoopers’ work involved an initial review of the company’s operations to:

• Establish the significance of current and future environmental concerns on the target company’s operations
• Identify material issues affecting the target’s operating costs, capital expenditures, and asset values or result in the target incurring direct or contingent liabilities
• Propose corrective actions to achieve or maintain compliance with appropriate environmental legislation, “reasonable” operating standards and practices, and agreements with suppliers and financiers

The outcome

By providing an indepth review of the target’s environmental liabilities, PricewaterhouseCoopers helped the client develop a better informed view as to the appropriate terms of an acquisition.