Feasibility Study to Identify the benefits of a Strategic Alliance between Aquatec-Maxcon and Ipswich City Council

This Feasibility Study is designed to form the base strategy document detailing operational guidelines for a proposed Alliance between Ipswich City Council's Water & Sewerage Services, and Aquatec-Maxcon Pty Ltd. The proposed entity name of the Alliance is Sunshine Water (Pty Ltd). The Project examines the viability for the economic development of the joint venture which would see: the commercialisation of that part Ipswich City Council’s Water & Sewerage Services related to the treatment of water, and treatment and disposal of sewage and sewerable trade waste . the development of a new, vertically integrated water business utilising the long term municipal water and waste water system operating experience of Ipswich City Council on the one hand, and the water and waste water treatment plant design and construction/engineering experience of Aquatec-Maxcon on the other. With a turnover of approximately $4m - $5m in the first few years of operation, rising to approximately $10.2m in the medium to longer term, the Project has the potential to generate an annual income stream in the order of $325,000 to Ipswich City Council (by way of concession fee), plus dividends / profit sharing and (if applicable) preference share entitlements. Compliance with NCP will also mean additional subsidy income available to Council under the new privatisation rules. Projected Earnings After Tax for Sunshine Water Pty Ltd ("year-in-year-out") is estimated @ $0.22m, with break-even planned for the first few years of operation. In addition, the Project will have the effect of immediately reducing Ipswich City Council’s Treatment Services costs by 5%. There is also potential to reduce this amount further in the medium to longer term. Projected growth of the new business will also increase both direct and indirect employment opportunities in the region, and enhance/ expand career prospects for existing Council personnel. In short, this study demonstrates that the "sum of the two parties" working together is greater than that where they are working "alone".