NYIT School of management Report CASE STUDY 22: VICTORIA CHEMICALS PLC(A) CAPITAL BUDGETING DECISIONS SUBMITTEDTO: DR.RAJA NAG PREPARED BY: SEVTAP BATIR HONEY MEHTA JUN HUANG NYIT School of management Report CASE 22 Victoria Chemical In 2007‚ Victoria Chemicals experienced a significant drop in its improve its performance as its earnings had fallen 38% from 250 pence per share to 180
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VICTORIA CHEMICALS PLC Ricky Tjayadi 01120120028 Young Jung Kim 01120120201 Irene 01120120214 VICTORIA CHEMICALS PLC The Background Victoria Chemicals‚ a major company in the chemical industry‚ was the number one producer of 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
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obtain funding from the corporate headquarters of Victoria Chemicals. The project has an initial outlay of GBP12 million to renovate and rationalise the polypropylene production line at Merseyside plant. This is done in order to make up for deferred maintenance and exploit opportunities to achieve increased efficiency. This report will look at the following four main areas of concern in order to calculate the feasibility of this Merseyside Project: * The cost of GBP2 million for the purchase
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Victoria Chemicals PLC: The Merseyside Project Prepared by Gabriela Tiffany Executive Summary The purpose of this report is to provide an understanding and analysis regarding the project proposed. The report starts with a brief overview of the company and the project proposal. This report then continues with assessing the concerns of Transport Division‚ ICG Sales and Marketing Department‚ and Treasury Staff. Furthermore‚ this proposal will also evaluate the recommendation from the Assistant Plant
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* * Yogi’s Minimum * Case 08-4 * * Background * * A public utility company‚ Big Bear Power‚ has signed a 10-year non-cancelable lease from Goliath Company for a combustion turbine. The lease agreement is signed on December 15‚ 2004 and Big Bear has the right to use the turbine as of January 1‚ 2005. * Annual lease payments are $1 million per year‚ payable ratably over 12 months at the beginning of each month‚ according to the lease agreement. The minimum rent
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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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Diamond Chemicals PLC (A): The Merseyside Project The objective of this report is to demonstrate to the senior management of Diamond Chemicals PLC that sufficient capital should be allocated for the proposed £9 million expenditure to renovate and rationalize the polypropylene production line at the Merseyside Plant. The Merseyside Plant is aging and therefore it is losing its competitiveness relative to some of its industry peers. Because the industry is in a downturn and “an oversupply is in
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I. Introduction Victoria Chemicals is one of the leading producers of Polypropelene‚ a polymer that is used in many products ranging from carpet fibers‚ automobile automobile components‚ packaging film and more. When Victoria Chemicals started up in 1967 they built two plants‚ one in Merseyside‚ England and one in Rotterdam‚ Holland. Both plants were identical to each other and produced an equal amount of goods. Morris Greystock‚ the controller of the Merseyside plant had notice a decline in
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VICTORIA CHEMICALS plc (A) The Merseyside Project Presented by Group 2 : Aldy Rifianto‚ Dedy Mardianto Floriana Nataly‚ Hiralalitya Lextro Kristiano Concorda Natallia Winata‚ Wita Puspadilla Yosua Bangun THE MERSEYSIDE PROJECT SUMMARY PROBLEM IDENTIFICATION ALTERNATIVE SOLUTION RECOMENDATION SUMMARY • Victoria Chemicals‚ a major competitor in the Worldwide chemicals industry‚ was a leading producer of polypropylene‚ a polymer used in an extremely wide variety of products SUMMARY Victoria Chemicals
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Diamond Chemicals is a leading producer of polypropylene‚ the polymer used in a variety of products (ranging from medical products to packaging film‚ carpet fibers and automotive components) and is known for its strength and elasticity. Diamond Chemicals is producing polypropylene at Merseyside (England) and in Rotterdam (Netherlands). Both factories are identical in size‚ age and plant-design. They were both built in 1967. Merseyside production process is the production process that are old‚ the
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