Arauco'S Integration Strategy

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    Arauco's Integration Strategy

    ARAUCO:  Forward  Integra3on  or  horizontal   expansion?       Aude  Andrawis        –        Individual  Assignment   Strategy  –  Individual  case  write-­‐up  –  28mar12  –  Aude  Andrawis   In  2004,  Alejandro  Pérez,  CEO  of  Arauco,  and  its  shareholders   are  discussing  whether  to  integrate  into  the  paper  industry  or  to

    Words: 756 - Pages: 4

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    Case Analysis-Arauco

    alternatives: one was forward integration moving into paper manufacturing; the other one was horizontal expansion investing US $1 billion to construct a new state-of-the-art chemical pulp plant. 2. Situation According to the case, we can see that the competition in the pulp industry is strong. First, the competition of existing competitors in market pulp was strong. From the case we can get that most of the large companies were involved in backward integration to produce the pulp for their

    Words: 3446 - Pages: 14

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    Arauco Case Study

    Arauco Case Study Question 1 - Do you think it is a good idea for Arauco to build the Nueva Aldea project? In this question we will be using the DCF technique in order to evaluate the project feasibility: Project name: Nueva Aldea Construction time: 3-4 years, we chose a 4 year construction time because we assumed it will take 3 years of direct constructing and a 1 year for extra delays and administrative procedures. We will also assume that the cost of the construction will be divided evenly

    Words: 2605 - Pages: 11

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    Arauco Case

    grid, which would significantly reduce the cost of electricity transmission. In addition to the strategic location also would exist benefits regarding transdisciplinary work between different plants. Benefits that result in a consistent process integration, cross information, facilitating learning, technological exchange and decreased bureaucracies, all factors which contribute to the improvement of production processes and efficiency. In relation to economies of scope, this new project would achieve

    Words: 1973 - Pages: 8

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