Valuation
EES Consulting has worked for a variety of clients interested in mergers, acquisitions, municipalizations, condemnations, and the formation of new utilities. All of these projects involve determining the value of either an existing system or a new one. While evaluating a new system is an economic and financial exercise, the evaluation of an existing system involves surveying the physical plant of the system to confirm not only its existence, but also its general condition. We have performed extremely thorough evaluations as a part of engineering due diligence for the purchase of various utility systems on several occasions.
An important component in preparing for the purchase of utility infrastructure is performing a preliminary engineering due diligence on the assets. A buyer must be satisfied that the assets are in existence and in good working condition. On the other hand, a seller needs to determine a fair price for the system. EES Consulting has performed several financial due diligence analyses in the area of the valuation of assets. We have reviewed the buying and/or selling utility’s rate structures, terms and conditions, financial pro formas associated with the sale, and associated asset sheets and income statement items, and opined on their appropriateness.
Shady Cove Water Works, LLC
Shady Cove Water Works, LLC, a privately held company intended to be funded by accredited investors, plans to develop a private water system to serve new development and the current residents of the City of Shady Cove. The City of Shady Cove currently does not operate a municipal water system. Residents and businesses obtain their drinking water from over 900 wells located inside the city limits, some of which are organized into small neighborhood systems. EES Consulting provided regulatory assistance with the Oregon Public Utilities Commission, financial modeling of the project costs and required equity investment, and assistance in drafting the project prospectus.
Basin City Water/Sewer District
EES Consulting performed a fair market valuation of an existing water system serving over 100 customers in Basin City. The valuation assisted the newly formed Basin City Water/Sewer District in purchasing the property and negotiating a fair price.
City of St. Paul
The City of St. Paul is located in Aleutians West Census Area, Alaska, located on Saint Paul Island in the Pribilofs, an Island group in the Bering Sea. St. Paul has a population of approximately 530 people within its 40 square miles. The City provides electric power services to approximately 235 customers in St. Paul, Alaska. The City is a municipality regulated by the Regulatory Commission of Alaska (RCA). EES Consulting was commissioned by the City to prepare a Fair Market Value (FMV) of all the City’s electric generation and distribution facilities. EES Consulting inspected the powerhouse and distribution system. Based on the inspection of the system, EES Consulting determined a fair market value for the utility.
