The McLean Group Advises Compass Water Solutions on Its Sale to CECO Environmental
McLean, Va. – June 1, 2022 – The McLean Group is pleased to announce that it advised Compass Water Solutions (“Compass”) on its sale to CECO Environmental (Nasdaq: CECE). Compass is a leading global supplier of membrane-based, industrial water and wastewater treatment systems that help customers achieve regulatory compliance of water discharge at the lowest lifecycle cost.
The transaction adds critical engineered solutions and an experienced leadership team to CECO’s growing industrial water capabilities. CECO expects the Compass acquisition to unlock greater value by leveraging CECO’s international sales resources, existing US Navy expertise, and global engineering and production footprint. In addition to market growth rates, the expected stricter water discharge regulations coupled with hard-to attain international certifications are expected to drive higher sales.
Over the past four decades, Compass has taken a leadership position in offering advanced membrane oily water separation (OWS) and reverse osmosis (RO) technology solutions to the marine and offshore markets with its industry leading UltraSep, Aqua-Sep®, and CRP-SEP® branded product offerings.
The McLean Group ran a very efficient and thorough M&A process, thereby allowing the Compass team to focus on the daily needs of running the business. McLean’s understanding of the water market was invaluable in finding the ideal strategic partner to further drive our Company’s vision.”
Thomas Farshler – Compass CEO
About Compass Water Solutions
Compass Water Solutions® (“Compass”) is a world-wide leader in the engineering, manufacturing, sales and service of membrane-based water and wastewater treatment systems. Compass helps customers achieve environmental compliance of water discharge (“Assurance against a spill”) at the lowest lifecycle cost using high-capacity oil-water separators, slop-water separators, reverse osmosis water-makers, water filtration and purification technology. The Company is widely recognized for its brand name, international certifications, global installed base and nearly 50 years of application expertise serving multiple industries. Compass has grown in annual revenue by providing highly differentiated solutions that protect marine environments and offshore operators. The Company is headquartered in Tustin, CA and operates an ISO 9001 certified assembly plant. For more information, please visit https://compasswater.com
About CECO Environmental Corp. (Nasdaq: CECE) (“CECO”)
About The McLean Group
For over 30 years, The McLean Group has been providing investment banking and financial services offerings focused on the Defense, Government & Intelligence (DGI), Security, Critical Infrastructure, Maritime, Facility Services, Unmanned Systems, and Public Safety markets. Our 60+ professionals bring deep industry experience and relentless execution to every client engagement. We provide solutions that blend financial creativity with operational expertise. Whether we are providing transaction advisory, valuation opinions, or growth capital, our services are unmatched in these core markets. Learn more at www.McLeanLLC.com.
RECENT NEWS
PCC Elections for Private Company Acquisitions: What PE Sponsors, Portfolio Company CFOs, and Their Advisors Need to Know Before Making the Call
Private Company Council (PCC) accounting elections offer PE-backed companies a meaningful opportunity to reduce the scope and cost of purchase price allocation work, but the decision carries long-term implications that extend well beyond the close. Under ASU 2014-02, private companies may amortize goodwill on a straight-line basis over up to 10 years, eliminating the burden of annual impairment testing. Under ASU 2014-18, customer-related intangibles and noncompetition agreements may be subsumed into goodwill rather than separately recognized and valued. Together, these elections can streamline acquisition accounting and lower ongoing audit and compliance costs, but they also introduce restatement risk if the portfolio company later pursues an IPO or is acquired by a public buyer. For PE sponsors, the decision should be evaluated in the context of the fund’s exit thesis and applied consistently across portfolio companies. […]
Revenue Looks Strong on Paper – But ASC 606 Compliance in Construction Tells a Different Story
Revenue looks strong on paper – but ASC 606 compliance in construction tells a different story. In this case study, The McLean Group’s Financial Consulting and Transaction Due Diligence teams walk through a real construction services engagement where a project-level ASC 606 review surfaced a pattern of revenue recognition issues that materially changed the earnings picture. We examine the KPIs that matter most, including cost-to-complete accuracy, change order approval rates, and over and under billing trends, and explain why ASC 606 compliance deserves the same rigor in diligence as working capital analysis or debt-like items. […]
Purchase Price Allocations Under ASC 805: What Every PE-Backed CFO and Deal Team Needs to Know
A purchase price allocation (PPA) is the first post-close workstream that directly affects reported EBITDA, lender covenant calculations, and eventual exit valuation for PE-backed acquirers. Under ASC 805, every acquisition requires the buyer to allocate the total purchase price to identifiable assets and liabilities at fair value — including intangibles that never appeared on the target’s balance sheet. For middle-market deals, identified intangibles commonly represent 30–60% of total consideration, and each carries its own valuation methodology, useful life assumption, and amortization consequence. The McLean Group’s Valuation Advisory team breaks down what every CFO, controller, and deal team needs to know about getting the allocation right the first time. […]