A global engineering and sustainable technology company was looking to expand its autocatalyst capacity in Europe. The company considered options associated with its existing plants, as well as new market opportunities, and approached Gatehouse to conduct an assessment of the contextual risks. The specific project analysed an expansion of an existing site in Macedonia and a new-build option in Poland, and focused on the impact of contextual factors on investment outcomes.
Despite the obvious financial benefits of expanding the existing site, Gatehouse’s sensitivity analysis highlighted six high-dependency factors with serious business constraint implications. This was then combined with a geopolitical review, incorporating three Macedonain specialists, that highlighted a variety of political, security, governance and distribution issues with the potential to be exceptionally disruptive to business operations. The Polish site had similar dependencies and our three Polish experts provided some concerning insight of an increasingly politicised operational environment. However, by comparison the Polish site offered a lower ‘geopolitical risk premium’ and the likelihood of stronger returns over time.
Gatehouse provided the client with a comprehensive overview of the relative strengths and weaknesses of each site, as well as red flag issues to track. The company used Gatehouse’s comparative analysis as the basis for discussion at board level and decided to make an investment in the Polish site.
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