Prysmian Group plans expansion in Russia
Prysmian Group entered the Russian market when it acquired RybinskelectroKabel, one of Russia’s most dynamic cable manufacturers, in December 2009. This was the first move in an expansion strategy to develop the group’s presence in high-growth countries.
Russia is a strategic market for Prysmian Group, particularly in the sector of high voltage (HV) cables, and Rybinsky is an ideal platform for further investments in the sector. We aim to become a consolidated supplier of the leading players in the energy generation, transmission and distribution, not to mention other industrial applications related to the oil and natural gas sector.
This will involve not only increasing the efficiency of RybinskelectroKabel but also expanding production. Our three-year development plan from 2010-2012 is overseeing an expansion of the company’s product range in the construction business, including items such as fire-resistant, low smoke zero halogen cables (LSOH) and aluminum cables.
The second phase will begin next year with the production of cables for use in the automotive and oil and gas transfer sectors. Finally, the third phase will culminate in setting up a production facility for HV and medium voltage (MV) cables for utilities.
With Russian utilities operators are involved in upgrade and development investments worth several billion, the beginning of our Russia-based production means that Prysmian Group has a significant competitive advantage that will strengthen our presence in a market with great potential.
Prysmian’s expansion project is proceeding as planned as Yaroslavl Governor Sergey Vakhrukov recently observed during a visit to our factory in Rybinsk. The management team, headed by CEO Cesare Biggiogera and representatives from EXPA and other Russian stakeholders, has been by this time consolidated.
One key activity supporting this strategic development plan is the recruitment and training of new staff. We aim to train approximately 100 new employees from both the Yaroslavl region and around the country. The production process for cable production in oil and gas transfer and automotive products is up and running and will begin supplying customers in the first quarter of 2012. Furthermore, the building for the new MV/HV cable plant is almost ready, and is expected to be fully complete by the beginning of 2013.
In addition to the Yaroslavl plan, our acquisition of Draka in 2011 has greatly expanded the company’s industrial presence in Russia. Along with the acquisition and upgrades made to the existing REK facility in Rybinsk, Prysmian is also now present in St. Petersburg through Neva Cable Ltd, a Telecom cable manufacturer of copper and other fiber optic cables.
We have also recently been awarded an important contract for the development of a high voltage power transmission grid in St. Petersburg by FSK, the national power transmission grid operator and the supply of high voltage cables and accessories for the upgrade of the Moscow transmission grid. Moreover, we have reached a significant milestone in Russia through our telecommunication product VertiCasa FTTH cable system by laying more than 1,000 km of cable throughout the country. These are some of the essential steps that have contributed to making Prysmian Group one of the most important Russian cable producers in terms of new technology, efficiency and innovation.
Cesare Biggioggera is CEO of Prysmian Group Russia.