SWOT analysis and strategy support - value adding opportunities.
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Steel Industry Strategic Appraisals
MCI Diagnosis: Value creation opportunities
| Company | Country | Strategic opportunity |
| Anshan | China | Consolidation via acquisition of Benxi |
| ArcelorMittal | Luxembourg | Sale of selected Central European steel assets. Mine safety improvements in Eastern Europe. Longer-term downstream pursuit of construction markets, including building design / fabrication / distribution / erection jv's in Asia |
| Allegheny Technologies | USA | Corporate governance issues |
| Azovstal | Ukraine | Leverage of cost advantage / strategic localisation through regional M&A |
| Baosteel | China | Merger or acquisition with Magang Group [Ma'anshan] and with Handan Steel to create world's 2nd largest steelmaker behind ArcelorMittal |
| BlueScope Steel | Australia | Disposal of downstream cold rolling / coating ventures [Asia Coated Product Operations] in Thailand and Indonesia; perhaps also of North Star joint venture in the USA to a large CIS steel group |
| Bohler Uddeholm | Austria | Special steels opportunities in Eastern Europe |
| Cleveland Cliffs | USA | Corporate governance issues |
| Corus | UK | Long term exit from UK steelmaking. Purchase of semis for UK with more emphasis on downstream development / value added |
| Dneprospetsstal | Ukraine | Environmental performance improvement, especially airborne emissions |
| Erdemir | Turkey | Creation of Black Sea Steel Group |
| Evraz Holdings | Russia | Front end modernisation, including Nizhny Tagil open hearth furnace closure |
| Gazmetal | Russia | Creation of a leading Euroasian iron-ore and steel alliance |
| Gerdau | Brazil | Expansion of engineering steel production [SBQ steel] in new geographies beyond Brazil and Spain |
| GIIC | Bahrain | Middle Eastern partnership to create Brazilian iron ore supply deal |
| GSHL | Nigeria | Long-term start-up of Ajaokuta driven by medium-term ramp up of downstream production |
| Ilyich | Ukraine | OHF closure; investment in continuous casting; downstream mill modernisation |
| Industrial Union Donbass, IUD | Ukraine | Iron ore supply partnership |
| Isdemir | Turkey | Consolidation of Turkish long product sector |
| Kremikovtsi | Bulgaria | Reorientation to higher value downstream steel processing; under new ownership perhaps? |
| Magnitogorsk Metallurgical Kombinat [MMK] | Russia | Reorientation to (higher value) flat products |
| Mittal Steel Krivoy Rog [formerly Krivorozhstal] | Ukraine | Switch (perhaps just partial initially) from long to flat hot rolled products, making use of local iron ore for the production of higher quality steels |
| Mittal Steel Termitau [formerly Karmet] | Kazakhstan | The priority need seems to be mining health and safety improvements |
| Nippon Steel | Japan | Consolidation with JFE followed by facility rationalisation and internal restructuring along lines of the British Steel turnaround seen in the late 1970s |
| NLMK | Russia | 22 million tonnes of Russian crude steel output by 2015 |
| Nucor | United States | Upstream emphasis on iron unit sourcing. Downstream continuation of pursuit of opportunities in construction |
| Outokumpu | Finland | Expansion of Tornio facilities for CIS / Asian markets |
| POSCO | Korea | Pursuit of international ventures especially in Vietnam, Laos, Cambodia; acquisition of [or much closer production oriented collaboration with] the Vietnamese Steel Corporation |
| Rautaruukki | Finland | Switch to cleaner steelmaking at Raahe. Expansion into pre-fabricated building markets / construction supplies, driving South |
| Riva | Italy | European merger |
| RusSpetsStal | Russia | Consolidation of Russian stainless steel production assets (beyond Red October) to form a 'Special Steel Holding' involving mutliple suppliers |
| Severstal | Russia | Sale of Severcorr and other North American assets [e.g. to CSN] to help with debt repayment. In Europe, conversion perhaps of Lucchini Piombino facility to EAF steelmaking |
| Shougang | China | Reverse takeover of Tangshan to form dominant 25 million tonne steelmaking Group |
| Sumitomo | Japan | Shift from technical cooperation to international manufacturing jv and cooperation agreements |
| System Capital Management | Ukraine | Iron ore price control through dominance (via MetInvest / Smart) of Ukrainian supply |
| Tata Group | India | Development of global assets, capabilities and brands. Much deeper integration of Corus with slab sourcing from Jamshedpur plant in India and / or from new greenfield steelmaking facilities in African continent [e.g. Liberia] fed by local iron ore and low cost local gas |
| ThyssenKrupp | Brazil | Coking coal and iron ore pellet supply issues |
| ThyssenKrupp | Germany | Joint ventures / partnerships looking East |
| TISCO | China | Melt shop upgrade & capacity expansion; reorientation to special steels |
| Trinecke Zelezarny | Czech Republic | Upstream integration with Moravia Steel |
| U.S. Steel | USA | Acquisition led business growth and / or greenfield investment in South America |
| Vale | Brazil | Investment in steel plants in Brazil with emphasis on local addition of value to domestically produced iron ore |
| Voestalpine | Austria | Growth beyond 500km hinterland - development of larger scale via greenfield Central or East European CSP plant, possibly in the Black Sea region |
| Wuhan | China | Merger with Panzhihua Iron and Steel |
| Zaporizhstal | Ukraine | Closure of Siemens-Martin OHF furnaces - steel shop modernisation to BOF steelmaking |
To discuss these or any other strategic options, please contact MCI.
We charge $200 for a short consultation (up to 10 min by phone) or $1000 for a short written report including a SWOT diagnosis covering any single firm in the list shown above.
The appraisals above cover expected plans / opportunities for performance improvement or strategic turnaround as identified by MCI around early / mid 2009. The opportunities as shown do not necessarily concur with management plans. Indeed, in most cases the ideas shown are those of MCI, written by MCI from our own deliberations about company strengths, weaknesses, threats and opportunities without Board or Management consultation. The SWOT analyses behind each of these analyses, together with a short explanation of the underlying strategic reasoning can be supplied at a small cost. For further information, please contact Metals Consulting International by email or call +44 775 149 0885.
