1. © 2016 PricewaterhouseCoopers Sustainable Solutions
Sustainable
Solutions
Parker Decraene, Alexa Graf, Samuel Isken and Austin
Rieck
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2. © 2016 PricewaterhouseCoopers Sustainable Solutions 2
Purpose: To provide a basis for Greenlight’s decision on acquiring RubberUp or
investing in the development of a tire recycling practice.
PwC Services
Accounting
Implications
Balance
Sheet Change
Sustainable
Solutions
Current
Situation of
Greenlight
Agenda

3. © 2016 PricewaterhouseCoopers Sustainable Solutions
Company Profile: Greenlight
• “At Greenlight, we make tires that keep America
moving.”
• “Built at Greenlight for Greenlight”
• Greenlight 2030
• Incorporated in Delaware and headquartered in
Mississippi.
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Current Situation of Greenlight

4. © 2016 PricewaterhouseCoopers Sustainable Solutions
• Greenlight produced tires that were found in protected
wetlands along Mississippi River.
• Facing $5 - $10 million in fines and $15 million for
restitution.
• Need to put sustainability at the center of your business
practices
• Greenlight plans to develop a business to recycle used tire rubber
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Current Situation of Greenlight
Current Concerns

5. © 2016 PricewaterhouseCoopers Sustainable Solutions
• Two different options moving forward:
• Increase Research & Development efforts to implement this
idea
OR
• Acquire RubberUp, an existing business that already has
many of the industrial aspects and technology required.
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Possible Responses
Current Situation of Greenlight

6. © 2016 PricewaterhouseCoopers Sustainable Solutions
• Privately held company based and incorporated in
Atlanta, Georgia
• Manufactures rubber-based products from recycled
tires.
• Has a strong presence in the market for sustainable
and environmentally conscious products.
• Originally served only businesses but has recently
expanded to serve consumers.
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Company Profile: RubberUp
Current Situation of Greenlight

7. © 2016 PricewaterhouseCoopers Sustainable Solutions
Solution to the Problem
• Our Considerations
• Current Ratio - Measure of the ability to pay short & long term
obligations
• Large cash sums are necessary for potential legal problems
• Maximization of Net Income is important in looking at potential
reinvestment in the future
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Sustainable Solutions
Decision: Acquire RubberUp to improve your sustainability efforts.

8. © 2016 PricewaterhouseCoopers Sustainable Solutions
Changes on The Balance Sheet
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• Changes from 2015 to 2016 in the Balance Sheet
• Cash decreased
• Inventories increased
• Goodwill increased
Balance Sheet Change
Cash
$1.49m
Current
Ratio
0.23

9. © 2016 PricewaterhouseCoopers Sustainable Solutions
Corporation Tax By State
• Corporation Tax - tax on the income or capital income
of corporations
• Tax benefit from acquiring RubberUp due to lower tax
scenario
• Lower tax rate in Mississippi
• Sustainable company
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GA
6.00%
MS
5.00%
DE
8.70%
Accounting Implications

10. © 2016 PricewaterhouseCoopers Sustainable Solutions
Accounting Considerations
• Proper accounting procedures for an acquisition
• Goodwill Impairment
• Acquisition Premium (25% Premium)
• Depreciation & Capital Expenditures
• Other considerations
• Acquisition charges
• Research & Development to be expensed or capitalized
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Accounting Implications

11. © 2016 PricewaterhouseCoopers Sustainable Solutions
• PwC’s Services that will assist you in the future:
• Financial Due Diligence
• Mergers & Acquisitions
• Tax Exposure
• Valuations
• Strategic Sustainability
How can PwC help
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PwC Services

12. © 2016 PricewaterhouseCoopers Sustainable Solutions
A Look Ahead for Greenlight
• Final recommendation by PricewaterhouseCoopers
• Acquire RubberUp
• Action should be taken immediately
• Within two weeks alert the firm if you will be accepting the
proposal and acquiring RubberUp.
• Acquisition will occur immediately and the firm will be present for
the next six to twelve months to ensure a successful transition.
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13. © 2016 PricewaterhouseCoopers Sustainable Solutions
References
PricewaterhouseCoopers, P. (2016). Mergers, acquisitions, dispositions, IPOs. Retrieved November 14,
2016, from http://www.pwc.com/gx/en/services/tax/mergers-and-acquisitions.html
PricewaterhouseCoopers. (2016). Greenlight. Retrieved November 16, 2016, from
http://greenlight.pwc.com/
PricewaterhouseCoopers. (2016). PwC on Sustainability. Retrieved November 14, 2016, from
http://www.pwc.com/us/en/corporate-sustainability-climate-change/pwc-on-sustainability-c-
suite.html
PricewaterhouseCoopers. (2016). PwC's careers site for students. Retrieved November 14, 2016, from
http://www.pwc.com/us/en/careers/campus/why-pwc/firm-facts.html
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