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Home > Projects > Environmental Due Diligence Associated with an M&A of an Overseas Chemicals Company by a Japanese Company
Manufacturing
# Environmental Due Diligence
Environmental Due Diligence Associated with an M&A of an Overseas Chemicals Company by a Japanese Company
ClientPrivate company (chemicals)
Location25 countries, including Japan, Germany, France, Switzerland, Turkey, South Africa, United States, China, Malaysia, and India
We handled the environmental due diligence associated with an M&A of an overseas chemicals company (head office in Germany) by a Japanese company. In providing this service, we first conducted a “desktop study” (=a document review and other activities that do not involve site tour) and identified plants with high environmental risk. We then conducted a site tour and Phase I Investigation as part of a detailed study of those plants.

PROJECTProject outline

Issue
The targeted company was a chemical company based in Germany that had 75 plants in 25 countries. The project was an auction (tendered) project, and due diligence was conducted by several companies that included the client, a Japanese company. We were asked by the client to handle due diligence pertaining to the environment.
Solution
We undertook this task by conducting (1) a desktop study, (2) a site tour, and (3) a Phase I Investigation. Starting with the desktop study, we performed an initial assessment of the environmental risks of each of the target company’s plants based on environmental documents that the company provided. We then visited plants that were designated by the target company (in Germany, the United States, and South Africa) to conduct on-site inspections and interviews. We had our own technical experts accompany us during the site tour. From there, we conducted a Phase I Investigation based on the results of the desktop study.
Through these studies, we identified the environmental risk held by the target company and calculated the costs needed to address and remedy them.
Outcome
Based on the results of this solution, we held a discussion with the client on how to consider reflecting them on the acquisition price, the content of steps to be taken until the transfer agreement date, and other matters. This helped the client understand the environment-related investment risks when making a bid.
Comment from the person in charge
Anonymous

The target company was an overseas company with manufacturing plants scattered all around the world, which presented problems. Namely, (1) the risks of numerous plants (a total of 75) had to be assessed in a short period of time; and (2) environmental laws and regulations and soil/groundwater contamination standards differed depending on the country or region, making assessment difficult. Working with our partners (overseas environmental consulting firms) who are well versed in the local languages and the local environmental laws and regulations, we successfully quantified the environmental risks of the 75 plants.
In recent years, more and more cross-border projects are arising as M&As become globalized. We leverage the global network we have built over our long history to swiftly meet our clients’ needs.

Description of the project presented in the example
Due Diligence for Mergers and Acquisitions (M&A), etc.のイメージ
Due Diligence for Mergers and Acquisitions (M&A), etc.

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