polypropylene‚ a polymer used in various everyday items. Victoria Chemicals at the end of 2007 was in a financial slump and was under pressure to improve their financial performance. Due to this financial slump‚ Lucy Morris‚ the Plant Manager at Merseyside Works‚ proposed a GBP12 million project to help modernize the production line of polypropylene by remodeling and relocating tank-car unloading areas to streamline the process‚ refurbishing polymerization tanks to achieve higher pressures and throughput
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I am pleased to share my concerns‚ analysis and recommendation about the Merseyside Project with you. Your DCF analysis is excellent and helpful. However‚ I have to make some changes to it. The memo will be divided into 6 parts. Suggestions for Merseyside project: P1 What should change in the DCF analysis and why: P1-P3 Other important issues: P3-P4 Evaluation of each investment Criteria: P4-P5 Ultimate recommendation and forward looking: P5-P6 Revised DCF analysis: Appendix
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UV1192 Rev. Mar 9‚ 2011 VICTORIA CHEMICALS PLC (A): THE MERSEYSIDE PROJECT Late one afternoon in January 2008‚ Frank Greystock told Lucy Morris‚ “No one seems satisfied with the analysis so far‚ but the suggested changes could kill the project. If solid projects like this can’t swim past the corporate piranhas‚ the company will never modernize.” Morris was plant manager of Victoria Chemicals’ Merseyside Works in Liverpool‚ England. Her controller‚ Frank Greystock‚ was discussing a capital
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Executive Summary of Victoria Chemicals Problem Definition: The organization‚ Victoria Chemicals‚ must determine whether or not to improve engineering efficiency through facility improvements at its production plant Merseyside Works. Relevant Facts: The Merseyside Project was evaluated with respect to the following criteria: (1) Impact on earnings per share (2) Payback (3) Discounted cash flow (“DCF”) and (4) Internal Rate of Return (“IRR”). The initial assessment of this project was based
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Case 1 Corporate Finance: Capital Budgeting and Resource Allocation Victoria Chemicals plc: (A) The Merseyside Project and (Case 22)‚ (B) Merseyside and Rotterdam Projects (Case 23) - Bruner‚ 6th ed. The two cases shall be written as one project Each group should hand in a final report plus be prepared to present their results at a seminar. The report should contain problems‚ methods‚ and relevant references well formulated and discussed‚ together with a thorough analysis. (Note: methods is
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Greystock‚ was discussin a capital p G w ng project that M Morris want to ted m . ct d ) million propose to senior management. The projec consisted of a (British pounds) GBP12 m ure onalize the polypropylen production line at the Merseyside plant ne n expenditu to renovate and ratio in order to make up for deferred maintenan and to ex d nce xploit oppor rtunities to a achieve incre eased productio efficiency on y. Victoria Che V emicals wa under pr as ressure from
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*DIAMOND CHEMICALS PLC (A):THE* MERSEYSIDE PROJECT EXECUTIVE SUMMARY This report mainly provides analysis and evaluation of a capital budgeting project proposed to Senior Management in Diamond Chemicals. The project has been proposed to improve the product output of Diamond Chemicals’ Merseyside factory. However‚ recently‚ problems such as capital expenditure‚ marketing cannibalization‚ discount rate‚ etc. have surfaced from different departments. Diamond Chemicals need to take all these factors
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Case 22: Victoria Chemicals The Merseyside Project Table of Contents Executive Summary 3 Problem Statement 3 Key Decision Criteria 4-5 Data Analysis 5-6 Alternatives Analysis 6-7 Recommendations 8 Action and Implementation Plan 8-9 Exhibits 10 References 11 Executive Summary Victoria Chemicals is a major competitor in the worldwide chemicals industry. They are a leading producer of polypropylene‚ which is a polymer used in products such as: medical products and carpet fibers.
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year. In addition‚ Victoria Chemicals saw the accumulation of its common shares by a well-known corporate raider named Sir David Benjamin. Victoria has higher cost and lower revenue problem. Victoria has 250.000 ton production figure. Based on Merseyside project Victoria chemical would experience 12.5%decrease in production which makes their production undersupply because their production is already maximum capacity. This 12.5% comes from 1.5 month which is 45 days in which the plants would be shut
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SUFFOLK UNIVERSITY SCHOOL OF MANAGEMENT Graduate Programs in Finance Fall Quarter‚ 2011 FIN MF 820 Financial Policy Thursdays: 7:15-9:55 Instructor: Dr. Shahriar Khaksari‚ CFA Office: S432 Phone: 573-8366 Email: skhaksari@suffolk.edu The New Corporate Finance: Where Theory Meets Practice Mcgraw-Hill Series in Advanced Topics in Finance and Accounting Course Objective This course is designed to allow students to develop a deep understanding
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