A manager must decide which cash flows are relevant in the financial analysis of a plant-renovation proposal. Prominent issues include: overhead allocation, sunk costs, cannibalization of a related business, use of excess capacity, shareholder vs. manager perspective, and absorption of unrelated projects. This case is a narrower version of "Empirical Chemicals Ltd. (A)" (UVA-F-1020). Its prime teaching objective is to stimulate a discussion of relevant cash flows. Unlike the A case, it does not complete a discounted cash flow (DCF) analysis, which is left for the student to finish.