Mechel Reorganizes after Liquidation of Ferroalloy Division
07/22/2014 - Mechel OAO, a leading Russian mining and metals company, reports liquidating the Group's ferroalloy division due to successful asset sales as part of the company's strategy.
Due to the sale of Tikhvin Ferroalloy Plant and Voskhod Mining Plant in late 2013, the company's Board of Directors decided to reorganize the Group's administrative structure by eliminating the ferroalloy division. As part of the reorganization process, Bratsk Ferroalloy Plant will be managed by the steel division (Mechel-Steel Management Company OOO). Southern Urals Nickel Plant, idle since December 2012, will be managed directly by Mechel OAO. Mechel-Ferroalloys Management Company OOO, the division's management company, will be liquidated.
In 2012, Mechel OAO's Board of Directors approved a development strategy that prioritizes mining and full-cycle steelmaking with a stress on manufacturing high value-added products (long rolls, specialty steels, stainless rolls and hardware).
"In order to cut down management personnel costs and due to a significant reduction in workload as several ferroalloy assets were sold and Southern Urals Nickel Plant OAO was halted, we decided to liquidate Mechel-Ferroalloys Management Company OOO. This decision logically follows from implementing our labor efficiency improvement program by optimizing management structures, which we approved in 2008. Thanks to our efforts in this field, we managed to reduce our administrative staff by over 3,000. The new administrative model will enable us to significantly cut personnel costs and ensure a more efficient mechanism for decision making," Mechel OAO's chief executive officer Oleg Korzhov said.
Mechel is an international mining and steel company which employs over 70,000 people. Its products are marketed in Europe, Asia, North and South America, Africa. Mechel unites producers of coal, iron ore concentrate, steel, rolled products, ferroalloys, heat and electric power. All of its enterprises work in a single production chain, from raw materials to high value-added products.
In 2012, Mechel OAO's Board of Directors approved a development strategy that prioritizes mining and full-cycle steelmaking with a stress on manufacturing high value-added products (long rolls, specialty steels, stainless rolls and hardware).
"In order to cut down management personnel costs and due to a significant reduction in workload as several ferroalloy assets were sold and Southern Urals Nickel Plant OAO was halted, we decided to liquidate Mechel-Ferroalloys Management Company OOO. This decision logically follows from implementing our labor efficiency improvement program by optimizing management structures, which we approved in 2008. Thanks to our efforts in this field, we managed to reduce our administrative staff by over 3,000. The new administrative model will enable us to significantly cut personnel costs and ensure a more efficient mechanism for decision making," Mechel OAO's chief executive officer Oleg Korzhov said.
Mechel is an international mining and steel company which employs over 70,000 people. Its products are marketed in Europe, Asia, North and South America, Africa. Mechel unites producers of coal, iron ore concentrate, steel, rolled products, ferroalloys, heat and electric power. All of its enterprises work in a single production chain, from raw materials to high value-added products.
