1. International Gold Company Evaluation - Investment Firm
An investment firm that was considering an investment in a well-known North American gold company engaged us to value the gold company and provide our estimate of its per-share value on the basis of our knowledge of the technical, operational, and financial aspects of the international gold business. (682-1)
2. Evaluation of Potential Joint Venture Partner - Natural Resources Investment Company
This assignment for a U.S. energy company was to evaluate the bona fides of a joint venture partner, review agreements and related matter for a geothermal project in Indonesia. The work included inquiries to sources in and knowledgeable about Indonesia and its business, legal, financial and military segments and the Indonesian government/foreign investor interface. A&S made extensive inquiries about a local company's qualifications to be a partner and had a business appraisal made. A&S defined the principal requirements of a local partner for a foreign investor and assessed the local company against these requirements.
Observations were made concerning various agreements together with recommendations to strengthen the terms and conditions for the investor, and enhance operating arrangements. A political risk assessment was provided to the client with a focus on Indonesian culture and the country as a place to do business. (728-2)
3. Projection of Future Iron Ore Markets - Major International Mining Company
This assignment was a world iron ore supply and demand study that included a 20-year forecast projection for production and prices to assist the client to evaluate a major iron ore producer's business, assets and value in the context of preparing a bid to acquire a minority position in the company that owned these assets. The work focused on providing the client with an understanding of the economics of the iron ore business and its markets, such as all significant factors that impact these markets, including the forces that would shape market share and price differentials between Brazilian and Australian producers. (743-1d)
4. Evaluation of Manganese Markets - Major International Mining Company
This assignment was a world manganese ore supply and demand study that included a 20-year forecast projection of production and prices to assist the client evaluate a manganese ore producer's business, assets and value in the context of preparing a bid to acquire a minority position in the company that owned these assets. The work focused on providing the client with an understanding of the economics of the manganese business and its markets, including all significant factors that impact these markets. (743-1e)
5. Evaluate Major Aluminum Company - Major International Mining Company
Our client was a major international mining company contemplating a minority investment in a major state-owned mining company about to be privatized. This assignment entailed analysis, observations and comments on an integrated aluminum producer owned by the company to be privatized for the purpose of assisting our client to evaluate the producers business, assets and ultimately value in the context of preparing a bid to acquire a minority position in the company that owned these assets. The work focused on an economic assessment of the integrated aluminum producers operations and its competitive and comparative position in the world's bauxite, alumina and aluminum markets. (743-1a)
6. Multi-Business Economic Evaluation - Major Multi-Industry Company
A&S was hired by a major Canadian company to provide an economic evaluation of its coal mining and coal railroad businesses.
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Extensive site visits and personnel interviews were conducted in both businesses. |
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A major computer model was developed for each business, allowing a wide range of production, cost, pricing, etc., scenarios to be examined. |
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Expected demand for coking coal was analyzed. |
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A comparative analysis of competing coals worldwide was done to include mining costs, rail and ship transportation charges, port charges, coal quality and currency exchange rates. (760-5) |
7. Brazilian Business Evaluation - Major Metals Mining Company
This assignment entailed a preliminary Investigation of CAEMI Mineração e Metalurgia S.A. as a potential investment. Our client was a potential investor seeking to find out, with as high a degree of accuracy as A&S could achieve: sold input on CAEMI's owners' objectives regarding its ownership; the status and details of any discussions between CAEMI and potential investors/joint venture partners; how the process was being managed; requirements of any realistic deal; who is acceptable or unacceptable to the owners; the attitude of the other major investor; the decision-making process; the perceived valuation of CAEMI by the owners; and the best approach to take for a new potential investor to formulate, process and close a deal.
The study itself investigated what was for sale; the values placed on it by the owners, particularly the family owners; the role to be played by the new investor; and who was in the game. A&S advised the client about establishing a relationship with the target company and to assess all the iron ore investment opportunities in Brazil (the 609-3 assignment).
For this work A&S assigned a team of five professionals (including several Brazilian experts) with backgrounds in the Brazilian iron ore industry, its markets, international finance, and business strategy. Most of the work was carried out by A&S staff and associates in Brazil. (693-2)
8. Multi-Business Review and Briefings - Confidential Client
A major multi-national natural resource company requested A&S to prepare and present business overview analyses of nine commodities including copper, iron ore, oil and gas, coal, gold, titanium, diamonds, platinum group metals, and nickel plus an overview of the relevant geology and exploration issues impacting these commodities. A&S utilized teams of experts managing from one to three people for each commodity. A total of twenty professionals completed this assignment in two weeks.
Our work consisted of providing the client with the industrial knowledge of each commodity as well as the key economic indicators and drivers for each group. A&S focused on seven areas shown below to give the client the desired knowledge about each commodity /business sector. They were as follows:
(1) Resource base: mineralogy, geology, and mineral economics of reserve/ resource;
(2) Overview of processing flow path, technologies and investment requirements;
(3) Demand Analysis: consumption segments, growth drivers, growth rates, aggregate demand, etc.;
(4) Commodity pricing - commercial frameworks and pricing trends;
(5) Supply Analysis: cost curves, capacity, emerging projects and industry participants;
(6) Competitive analyses focusing on selected major companies within the sector as well as apparent strategies, strengths and weaknesses; and
(7) Recent industry 'news' and current issues and implications of same.
9. Acquisition Analyses - Medium-Sized U.S. Gold Mining Company
Our work involved identifying, evaluating and presenting to our client potential acquisitions in Zimbabwe in the gold mining business. These potential acquisitions could take the form of (a) gold production from existing mines, (b) reserves contiguous to these mines, (c) present or potential development projects at various stages of development, and finally (d) reserves and resources both contiguous to these development projects as well as possibly being freestanding. The goal of the program was to enable our client to build a base in Zimbabwe of annual production of 100,000 ounces per year.
The work was done by a senior business consulting professional from the A&S' New York City office, a gold geologist from the Denver office who poured over public information and made a number of phone calls to Zimbabwe for further information and finally, the KPMG office in Herrara, which obtained copies of all relevant government reports, sent them to us in the U.S. for review and made a number of introductions to owners and managers of gold mines in Zimbabwe. (KPMG acted as our sub-contractor on this assignment.) (686-2)
10. Country Assessment For Mining Investment - Major Metals Mining Company
Our client was a multinational mining company considering an investment in a base metal mineral deposit in Vietnam being developed by a New Zealand junior mining company.
The assignment covered issues of political risk, mining tax, mining law, mineral ownership and other issues that concern mining such as climate, topography, and infrastructure.
For this work A&S assigned a staff member who has traveled frequently to Vietnam since 1988, including work with the government on mineral title management and other issues, who was invited to participate in the Vietnam 97 mining conference. (751-1)
11. Economic and Technical Evaluation - Major International Bank
Economic and technical evaluation of various gold mining projects. Conducted a dozen projects for the international trading subsidiary of a major British commercial bank. (552-3)
12. Evaluation of Potential Acquisition - Coal Mining Company
Our client, a U.S. coal company (15 to 20 million tons production per year) engaged us to assist in the evaluation of a potential acquisition of a coal company of almost equal size. Our role was to identify potential management issues including potential (1) savings, (2) problem areas in putting the companies together, and (3) potential requirements for structural change. (651-2)
13. Development Project Assessment - Major Investment Banking Firm
A&S provided an opinion as to project status during construction of a gold mine development project. Our client was an investment bank leading a syndicated financing of a gold mine and mill project with an estimated capital cost of $256 million designed to mine 37,500 tons/day ore with an average grade of 0.0252 oz/ton gold in an open pit mining operation.
The A&S assignment was to give opinions as to the project status against four criteria:
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Has anything occurred to affect materially the long-term operating performance of the project? |
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Where does the project stand against schedule? |
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Where does the project stand against budget? |
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How is the project being managed overall? |
For this assignment A&S also drafted completion test criteria for the project. (623-9)
14. Risk Outlook for Mining Subsidiary - Major Investment Bank
A risk assessment of the coal business of an oil and gas company. Our client wanted to know the risks of attaining the cash flows projected by the U.S. coal-mining subsidiary of this offshore oil and gas company. Both mining and marketing risks were assessed. Our work involved inspecting all production facilities, reviewing the company's business plan and reviewing all sales contracts. (722-1)
15. Report on Major Brazilian Iron Ore Producer - Major Australian Mining Company
Our client was an iron ore producer considering a strategic investment in a major Brazilian iron ore producer. A&S' assignment was to prepare a report providing details about the Brazilian company. The report included a discussion of all areas of operations (mines, transportation and port facilities), plus an assessment of areas offering scope for operating improvements. (There was a discussion of the key aspects of the previous year's operating results.) A&S included details and comments on the company's current expansion plans, sales and marketing, and expected future demand for its products.
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Our overall conclusions included a discussion of those areas we regarded as having the greatest risks and impacts on projections. |
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As requested by the client, the report included a bibliography with details of important references, industry sources and company data. |
For this work, A&S assigned a team of five (three from the U.S. and two from Brazil). Following a review A&S' extensive database, additional data requirements were identified and obtained. A&S contacted other industry experts, and on-scene fact-finding in Brazil, although A&S did not have official contact with management to obtain detailed information. Other visits were made to Brazilian industry and institutional contacts.
A comprehensive report on the company and its activities was prepared. The draft report was presented to the client for discussion prior to finalization. (716-3)
16. Assessment of Sales by a Chinese Coal Mine - Major investment Banking Firm
Our client, an investment banking firm, wished to determine the viability of coal sales from a mine of the Bureau of Datong People's Republic of China. Our client arranged for the sale of mining equipment and machinery to the People's Republic of China and take in return coal from the mine. Our client asked us for a judgment on prices for the sale of 5.5 million tons of coal from the mine to be sold over three years. We determined the specifics of the coal in standard U.S. coal industry terms, verified the specifications to the extent possible from long distances, determined the feasibility of shipping from the port, identified potential buyers and arrived at judgment regarding production, sales and bases. (387-6)
17. Argentina Small- and Medium-Scale Mining Projects - U.S. Government Agency
Our client was the Trade & Development Agency of the U.S. Department of Commerce. The assignment involved the selection and profiling of sixteen small- and medium-scale mining projects in Argentina and the preparation of a briefing book with the projects and background information. The resultant materials were presented to potential U.S. investors and equipment suppliers at a conference held in the U.S. on Argentina's mining sector.
The work program examined ninety projects identified by Argentine federal, provincial governments and others. An analysis scheme was used to select from those submitted, the more technically, economically and financially viable projects.
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Sixteen of these projects were profiled in depth in a briefing book. |
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In addition to the profiles, the briefing book prepared by A&S contained a background on the mining sector (geography, economic conditions, political structure, infrastructure, mining exploration & development, legal framework, repatriation of debt, etc taxes and royalties, Nuevo Cuyo Region, and financing). |
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A copy of the Mining Investment Laws & Relevant Environmental Regulations was also included in the briefing book. |
For this work A&S assigned a two-person team to travel to Argentina, experienced in the development of mining projects. In addition two other specialists provided financial and project evaluation expertise. (750-1)
18. Evaluation of ARCO Coal Company - Major U.S. Coal Company
We were retained by the client to assist in a Phase I evaluation of ARCO Coal Company when it was put on the auction block. This work was to conclude when the data room was opened. The actual work consisted of nine memos ranging from a few to 20 pages. We gave our knowledge of all the U.S. mines and, more important, provided updates on the sales process and ARCO's expectations. A&S could provide a unique perspective, since Tom Parker had ten years of experience with ARCO Coal and retired as a Vice President. (747-1)
