The project involved a techno-economic due diligence process related to the acquisition of the electricity and heat production as well as electricity transmission and heat distribution business activities of certain energy company (confidential) in Finland.
The techno-economic due diligence process was divided into three phases:
- Phase 1: Pre-IM and the Pre-Virtual Data Room (“VDR”) Access
- Phase 2: Post-IM and the Pre-VDR Access
- Phase 3: Post-IM and Post-VDR Access
During the due diligence process a more accurate picture of the operations of the trade target was formed step by step. The process led to a successful company acquisition by the purchaser candidate (confidential).
Greenfield Consulting contribution to the project
Greenfield participated in the project in conjunction with Arup. Greenfield’s task in due diligence process was to evaluate the district heating operations of the trade target. Evaluation included capital investment and operational cost estimates as well as life-cycle cost calculations of the components related to the production and distribution of DH. In addition, district heating business prospects in different locations in Finland were assessed in relation to competing alternatives, such as geothermal heat pumps and small-scale decentralized solutions.
Based on the assessment, the financial parameters and prospects related to district heating operations were modified and used as input values in the overall financial model and valuation.