Corus Group In France
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Transcript of Corus Group In France
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Best In France
Mon, 10 Dec 2007Prof. Michael SEGALLA
Corus Group In France
Beniamin SMOLIJSandor ERDEIKitty LIANGGa-Eun OH
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Executive Overview
■ Introduction■ History of Corus & recent acquisition■ Steel Market ■ Corus in France
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Introduction
■ Corus Group Aerospace, engineering, automotive, packaging,
construction, energy & power generation, consumer products, rail
■ Corus French subsidiary provides a range of rail products and railway
infrastructure services to the international rail industry
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Corus Group Financial Performance
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Sogerail
■ A subsidiary of the Usinor group(French company)
■ Employees : about 430 ■ Products: rail products■ Location : at Hayange in the Lorraine region of
France. ■ Turnover : 170 million euros
(March 1999 Recorded)
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Birth of Corus Group■ British Steel acquired Sogerail on 2nd October 1999 ■ British Steel merged with the Dutch steel producer
Koninklijke Hoogovens to form Corus Group on 6 October 1999
■ After this merger, conflicts led bad performance In 2001, operating loss touched £ 1.152 billion In 2002, losses stood at £ 458 million
■ In 2003, new CEO, Philippe Varin implemented ‘Restoring Success’ program
cost savings touched £ 680 million in 42 months, employee productivity rose by 5% in 2005
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Acquisition by Tata Steel■ In Oct 2006, the board of Corus decided to
accept Tata’s proposal to acquire■ Brazilian steel company CSN announced to
participate in acquiring Corus Group ■ The price was getting increased due to
competition■ Tata Steel acquired Corus Group at 608p per
share in April 2007■ Tata Steel Group consists of Tata Steel &
Corus Group Ltd
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History of Corus Group
Koninklijke Hoogevens N.V..(Dutch)
Corus
British Steel
British Steel Sogerail
Tata Steel Corus
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2006 Global Steel Industry
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After the acquisition
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World Steel Consumption
0
100
200
300
400
500
600M
illio
n To
ns
EU-25 143 152 152 159 156 155 158 160 160 167 169 173 177 183
USA 108 116 111 115 102 103 101 116 104 110 111 113 115 117
JAPAN 82 70 69 76 73 72 73 77 78 81 81 81 82 83
CHINA 103 110 123 125 154 186 233 270 315 356 403 443 470 489
MIDDLE EAST 16 17 17 20 23 25 30 31 35 37 40 44 46 48
1,997 1,998 1,999 2,000 2,001 2,002 2,003 2,004 2,005 2,006 2,007 2,008 2,009 2,010
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Sogerail British Steel
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Entering the French Market
■ Rail is a steel niche market■ Access to European market through France.
Know-how Transport, logistics
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Personnel Merge in France
■ Commercial unit moves to new French base■ 10 French employees laid off■ 30 British employees moved to France
■ British Nationals: 30■ French Nationals: 20
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Differences in style emerge
■ Centralization■ Limited autonomy■ Bureaucracy
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Cultural differences
■ Meetings: Highly organized Nice presentations Less decisions
■ Contacts The boss speaks only
to immediate subordinates
■ Language Bonjour, Merci..
■ Meetings: Less organized More discussions Faster decisions
■ Contacts The boss speaks to
every employee■ Language:
High expectations of English proficiency
English French
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Corus rail today
■ Only 5 British employees remained from the original 30
■ These 5 settled down in France■ The British and the French couldn’t work
together in long-term
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Negative effects of the merger
■ British tried to launch new products with their model, ignoring the French objections
■ Mr. Dabas and 3 other French managers left the company
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Positive effects of the merger
■ More control than before the merger
■ less accidents, the factory is safer for the workers
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Merger with Tata
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Merger with Tata
■ We do not know the results of the Tata takeover
■ Mr. Dabas thinks: Tata doesn’t even know that Corusrail exists
■ Tata is too far from France
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“Test of interests of Tata”
■ Corusrail will ask at the end of 2007 for investment
■ Increase Rail length 80 108■ Competitors have 120, but 108 can easier
transported■ Mr. Dabas advice: sell off Corus Rail
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Conclusion
■ Give confidence to the former employee■ Don’t control everything■ Send people who know French culture or at
least are interested in it■ If the objectives are not met than discuss
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We Thank
■ Mr. Gerard Glas CEO ■ Mr. Hubert Dabas Commercial Manager■ Ms. Laure Lafare Andministrative Assistant
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Thank you for your attention!