Project Description

Environmental Due Diligence – an investment firm at an acquisition of a private firm which held multiple sites in Israel

As part of the acquisition process of a private firm by an investment firm it was decided to conduct an environmental due diligence on the acquired company.

The goal of the project was to present as full a picture as possible regarding the private company’s compliance with all legislative requirements on environmental issues and enable the potential investors to reach an educated decision regarding their investment and, among other things, create a defence against lawsuits. To achieve this, the work was done using a legal firm specializing in environmental law. To conduct the project, we compiled a team of chemical engineers who worked around the clock summarising all of the environmental laws and regulations that applied to the private firm. The team reviewed documents, licenses and surveys, conducted interviews with executives in the company, in addition we conducted environmental field tests at the company’s sites and identified environmental deficiencies and gaps with relation to the environmental laws and regulations as well as with relation to common practice in Israel regarding environment issues.

We subsequently analysed the survey results and divided them into three levels:

H – Gaps requiring high financial outlay, pose a significant deviation from the requirements set by the law and/or are required to obtain licenses and/or environmental permits.

M – Gaps requiring medium financial outlay and/or may pose difficulties to obtain licenses.

L – Gaps which tend to be corrected as common practice, but are not expected to impact the ability to obtain licenses and permits.

In the next stage, we prepared an environmental corrective action plan by the following categories:

  • Required technical engineering changes: characterization and acquisition of reduction means to reduce environmental aspects. For instance, installation of systems to treat pollutants emission to the air, upgrading of drainage systems and separation of wastewater from service runoff, installation of spill containment systems. Conducting actions of preventative maintenance to all company facilities that may have a negative environmental impact or pose a health and safety hazard.
  • Required personnel-organizational changes: upgrading the organizational layout dealing with environment, health and safety aspects in the various plants. Setting authorities and responsibilities for compliance with legislative requirements.
  • Required procedural changes: checking the group’s companies’ general procedural system regarding environmental, health and safety aspects, adding and updating of father procedures at the organizational level. Setting up an internal enforcement system to comply with legislative requirements as well as the company’s procedures, preparing work instructions for every plant and site etc.
  • Implementing an organizational culture that places safety and environment as a combined part of the regular activity at the plants.

At the final stage we provided a price quote to implement the environmental gaps found and regulatory requirements that have been found to not be conducted at the company.

Throughout the process we had a continuous contact between us and the investment firm’s legal representatives. We maintained full transparency in the work stages, the information obtained at each stage and shared with them the gaps found. The investment firm examined the data when considering the acquisition process. Our environment division regularly conducts environmental due diligences to institutions, financial institutions and international firms, as well as other projects on environmental aspects such as ground surveys, wastewater surveys, waste classification, environmental planning.

Clients:

Tambur, Polygal, ICL-Allana Ethiopia, Vichy, Netafim

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