Having decided what to do with the stress equipment together with Mrs Fox, Nigel decided to go and get himself a cup of
Posted: Sun Jun 05, 2022 6:48 am
Having decided what to do with the stress equipment together
with Mrs Fox, Nigel decided to go and get himself a cup of tee.
Whilst pouring the water into his cup he heard a set of familiar
voices. It was the CEO, Ron Clarkson, and chairman of the board,
Julie Hammer. July is know to be very straight forward and today
was not an exception. "We need to get out of our dependence on oil"
she said. The idea was that that the oil business is coming to an
end and that will be sooner than anyone can imagine. However there
are opportunities at the horizon and that is a combination of
hydrogen and wind power and this requires a very special type of
pumps that Mrs Fox and her team have developed and got certified
but the European safety authorities leaving H&S Plc being the
only supplier on the continent. Julie stressed that the risk with
entering a new business required additional five percent on top of
the normal required rate of 10% Then the required ROI, return on
investment, at 15% must be met. Ron asked Nigel to be the company's
representative in a group with several investors to explore this
opportunity. Nigel needed to hand over his normal job to his deputy
Anna Lindros and travel to London to meet the group who secretly
was going to meet at Corinthian Hotel. The group consisted of the
most knowledgeable technicians, program managers and business
people in the UK. The stakes was massive and so also the complexity
of the project that was going to be situated north of Edinburgh.
The details were carved out and for H&S Plc. the investment was
£30 million. A number of scenarios was agreed to and for the first
year. There was a likelihood of 55% to get a cash flow, CF, of £10
million and 45% at £20 million during the first year. Given the £20
million the group identified a 25% chance for £35 million, 50% for
£45 million and 25% at £15 million. If then the £10 million was
delivered during the first year then the estimate was that at 30%
£35 million was going to be received, 50% at £25 million and 20% at
£10 million. Received cash flows were expected to be received at
the end of each year. Back at office Nigel had to spend some time
to deliver the analyse to Ron and Julie. Please make this analyse
and give your recommendation for how to go forward.
with Mrs Fox, Nigel decided to go and get himself a cup of tee.
Whilst pouring the water into his cup he heard a set of familiar
voices. It was the CEO, Ron Clarkson, and chairman of the board,
Julie Hammer. July is know to be very straight forward and today
was not an exception. "We need to get out of our dependence on oil"
she said. The idea was that that the oil business is coming to an
end and that will be sooner than anyone can imagine. However there
are opportunities at the horizon and that is a combination of
hydrogen and wind power and this requires a very special type of
pumps that Mrs Fox and her team have developed and got certified
but the European safety authorities leaving H&S Plc being the
only supplier on the continent. Julie stressed that the risk with
entering a new business required additional five percent on top of
the normal required rate of 10% Then the required ROI, return on
investment, at 15% must be met. Ron asked Nigel to be the company's
representative in a group with several investors to explore this
opportunity. Nigel needed to hand over his normal job to his deputy
Anna Lindros and travel to London to meet the group who secretly
was going to meet at Corinthian Hotel. The group consisted of the
most knowledgeable technicians, program managers and business
people in the UK. The stakes was massive and so also the complexity
of the project that was going to be situated north of Edinburgh.
The details were carved out and for H&S Plc. the investment was
£30 million. A number of scenarios was agreed to and for the first
year. There was a likelihood of 55% to get a cash flow, CF, of £10
million and 45% at £20 million during the first year. Given the £20
million the group identified a 25% chance for £35 million, 50% for
£45 million and 25% at £15 million. If then the £10 million was
delivered during the first year then the estimate was that at 30%
£35 million was going to be received, 50% at £25 million and 20% at
£10 million. Received cash flows were expected to be received at
the end of each year. Back at office Nigel had to spend some time
to deliver the analyse to Ron and Julie. Please make this analyse
and give your recommendation for how to go forward.