United Company Rusal is the world's second largest aluminium company by primary production output (as of 2016).[1][2] It was the largest until overtaken by China Hongqiao Group in 2015.[3][4] Rusal accounts for almost 9% of the world's primary aluminium output and 9% of the world's alumina production. Rusal was founded by major Russian industrialist Oleg Deripaska.
The United Company was formed by the merger of Rusal, SUAL, and the alumina assets of Glencore, completed in March 2007. According to its own statistics, Rusal accounts for 6.2% of the world's primary aluminium output and 6.5% of the world's alumina production, while operating assets in 13 countries over five continents, employing over 61,000 people across its international operations and offices.[5]
The company is incorporated in Jersey, where it has its financial centre, but its headquarters are in Moscow, Russian Federation. UC Rusal is a public limited company and its shares are traded on the Moscow Stock Exchange, Hong Kong Stock Exchange, and European Stock Exchange. Since 25 September 2020, the company changed its place of registration from Jersey to Kaliningrad, Russia.[6] In 2021 Rusal announced a proposal to demerge its high carbon assets and change its name to AL+.[7]
Company history
Predecessor companies 1991–2000
UC Rusal's roots lie in the business activities of Russian businessman Oleg Deripaska, who entered the metals industry as a commodities agent and broker at the Moscow Trade Stock Exchange (Moskovskaya Tovarnaya Birzha (MTB)) and then at the Russian Commodities and Raw Materials Exchange (Rossiyskaya Tovarno-Syryevaya Birzha (RTSB)). As a broker, Deripaska dealt in a wide range of commodities, including aluminium. His work also included trading with major Russian aluminium smelters.[8]
Between 1991 and 1994, companies set up by Deripaska with the backing of industrialist and entrepreneur Michael Cherney started investing in the shares of Sayanogorsk Aluminum Smelter (SAZ), one of the newest and most modern aluminium plants built in Soviet times (1980–1985).[9] In 1994, Deripaska was elected the General Director of SAZ.[10]
In 1997, the companies controlled by Deripaska underwent a general restructuring, resulting in the creation of Sibirsky Aluminium to manage the aluminium and alumina assets acquired by Deripaska's companies.
UC Rusal
In late March 2007, the merger between Rusal, its domestic competitor SUAL, as well as the bauxite and alumina assets of Swiss commodities trading group Glencore, created UC Rusal.[24][25] The merger created the world's largest aluminium company at the time,[26] with assets in 17 countries across five continents,[24] including 16 aluminium smelters, 12 alumina refineries, eight bauxite mines, three powder metallurgy plants, three silicon smelters, three secondary aluminium plants, three aluminium foil mills, two cryolite plants, and one cathode plant. The merger was completed in March 2007, at which time the newly formed company was estimated to have pro forma sales of $12 billion and production capacity of approximately four million tonnes of aluminum and 11 million tonnes of alumina.[27]
Company structure and activities
As of 2016, UC Rusal's most significant shareholders are En+ Group with a controlling stake of 48.13%, along with Onexim Group (13.7%) and SUAL (15,80%). Amokenga Holdings owns 8.75%, and Toni Shterev owns 0.1% of the shares in Rusal.a wholly owned subsidiary of Glencore. The remaining 13.37% accounts for the public float, and shareholding by the company management (0.25%).[5]
It was announced on 11 August that Onexim agreed to sell 7% of its Rusal stake to SUAL.[54] In February, Onexim had already sold 3.3% to SUAL.[55] Once the sale is approved, Onexim will retain a 6.7% stake in Rusal, while SUAL's will increase to 22.80%.[54]
As of 2023, UC Rusal's biggest shareholders are En+ Group with a controlling stake of 56.88% and SUAL (25.52%); the company's free-float stands at 17.6%.[56]
2018 U.S. sanctions
In April 2018, the United States imposed sanctions against Oleg Deripaska and his business enterprises, including Rusal, along with 23 other Russian nationals and entities in their control. According to The Washington Post, the Trump administration imposed those sanctions because of "Russia's 'malign activity.[63][64] The United States Department of the Treasury issued a statement declaring that Deripaska was accused of illegal wiretapping, threatening the lives of business rivals, extortion and racketeering. Other allegations included that Deripaska ordered the murder of a businessman and had links to a Russian organized crime group.[65] On 23 April, however, the U.S. government gave subsidiary Rusal America Corporation's customers "more time to comply with sanctions", even saying it would "consider lifting them if United Company Rusal Plc's major shareholder, Russian tycoon Oleg Deripaska, ceded control of the company." The Department of the Treasury gave these clients until 23 October 2018 to comply with (wind down business) the Rusal sanctions.[66]
In May 2018, the company announced the resignation of CEO Alexandra Bouriko and seven board members to avoid U.S. sanctions against Oleg Deripaska.
Sustainability
In 2017, UC Rusal publicly stated its goal to cover all the energy required to power its aluminium smelters via clean energy by 2020, particularly using hydropower.[70] In 2017, the company's energy mix included 90% renewables. The announcement was in line with UC Rusal's 2015 pledge to support the sustainable production of aluminium upon joining the Aluminium Stewardship Initiative.[71]
As a response to increased demand for sustainably produced aluminium from major downstream industries – particularly the motor, packaging and electronics sectors – Rusal introduced Allow, a low-carbon aluminium brand, in November 2017.[72] According to Reuters, Allow covers roughly 80% of Rusal's total output.[72]
In 2017, Deripaska expressed support for introducing steep carbon taxation to force other firms away from using coal power and reduce the industry's carbon footprint.[73]
Corporate social responsibility
2011 Japan earthquake
Following the 2011 Tōhoku earthquake and tsunami, UC Rusal donated $600,000 to Japanese children's and cultural heritage foundations.[75] These included the Ashinaga Foundation providing financial and educational support to children; the Yul Foundation supporting the learning process and psychological rehabilitation of pupils; and donations to the Ishinomori Mangattan Museum in Miyagi Prefecture for the city's reconstruction of cultural attractions.[75]
2012 Cholera outbreak in Sierra Leone
In 2012, Rusal donated 25 tonnes of medical supplies to Sierra Leone to control the outbreak of cholera in the country as part of its commitment to corporate social responsibility.[76][77]
Carbon footprint
Rusal reported total CO2eq emissions (direct and indirect) for the twelve months ending 31 December 2020 at 28,604 Kt (+490/+1.7% y-o-y).[82] The growth has slowed compared to the trend since Q4 2018 (CAGR +3.4%).
See also
- Aluminium: The Thirteenth Element
- Aluminium in Africa
- List of alumina refineries
External links
References
- World's leading primary aluminium producing companies 2016 Statista, retrieved 2017-09-08^
- UPDATE: Top 5 Primary Aluminium Producers in the World alcircle, retrieved 2017-09-08^
- China Hongqiao Group Surpasses Rusal be the Largest Aluminum Producer