Russian copper company - Русская медная компания

Country

Kazakhstan

Year of entry

2006, 2007, 2008

Industry/ business area

Metallurgy – non-ferrous metals

Entry mode

2006 - commissioning of an ore-dressing industrial complex. 2007 — construction began of the second concentrator plant, GOK Aktyubinsk Copper Company TOO 2008 - beginning of an open mine construction. All greenfield investments.

Motives

Obtaining new sources of raw materials, cost-efficiency through cheaper workforce in Kazakhstan.

Firm specific advantages used on the foreign market

Full vertical integration, professional management, cost-efficient processes.

First mover or follower

First mover.

Type of state involvement in the process of internationalization

No clear evidences of government involvement in the process. Nevertheless, possible indirect advantage due to the fact that Kazakhstan as CIS country and former SSSR country has close political connections with Russia.

Evaluation of the success of the internationalization

Investments were very successful, and company was able to acquire new sources of raw materials as well as possibility of cost-efficient strategies due to cheap labor force.

Country

Canada, Australia

Year of entry

Canada - 2010 – 2013; Australia - 2011

Industry/ business area

Metallurgy – non-ferrous metals

Entry mode

Speaking about current internationalization in 2010, ARMZ Uranium Holding Co. consolidated a 51.4% controlling stake in Uranium One Inc., a Canada-based publicly-traded uranium mining company with a diversified portfolio of projects located in Kazakhstan, USA, and Australia.⁴⁵That was a first move towards complete control of the company. In January 2013, ARMZ Uranium Holding Co. acquires 100% of Uranium One Inc. shares.⁴⁶

Then in June 2011, ARMZ Uranium Holding Co. closed a deal to acquire a 100% shareholding in Australian-based Mantra Resources Limited, a publicly-traded company. Mantra Resources Limited's largest project is Mkuju River in Tanzania, with a total mineral resource base of about 45.9 thousand tons of uranium. The operator of the Mkuju River project is Uranium One Inc.⁴⁷

Both investments were brownfield investments. Exploration and mining projects in Russia, Kazakhstan, Canada, Namibia, Armenia, Mongolia, and Ukraine. We should mention here joint venture which company undertakes with Armenian companies. Exploration for uranium and other mineral resources accompanying uranium has been carried out within the framework of the Russian-Armenian Comprehensive Cooperation Program – joint venture.

Motives

Gaining diversified portfolio of projects located in Kazakhstan, USA, and Australia. Gaining new markets, new technologies, experienced management and staff.

Firm specific advantages used on the foreign market

a diverse mix of projects and growth opportunities, great work experience in this industry, professional management, government support to internationalize.

First mover or follower

Follower in Australia, bearing in mind that Norilsk entered in 2007, in a sense first-mover due to different minerals which companies use. First mover in USA, Canada.

Type of state involvement in the process of internationalization

From ARMZ strategy objectives it is clear that this is a company which aims to internationalize trough out the world and that main goal of the company is to become global leader in atomic segment. In the same section is written that this strategic goal is being worked towards taking into account state interests and the corporate goals of Rosatom. That is clear sign of state ownership of the company.⁴⁸

Evaluation of the success of the internationalization

Internationalization was successful. By acquiring these companies ARMZ get global reach. Furthermore, it increased its market share, gain access to raw materials, acquire new technologies, and experienced staff as well as management.