Tnk-Bp

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SM0380 Doing Business in Europe, Asia and the Americas |
THK-BP case study |
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INDICE
Introduction 2
PART A 3
With reference to the academic literature and using your analysis of relevant environmental factors, speculate how and why BP identified AAR as a potential ‘partner’. In which areas are the expected benefits and synergies for both companies involved?. 3Macro analysis 3
Micro analysis 6
Conclusion 8
With reference to the academic literature, explain the risks associated with the choice of joint venture as an approach to this particular partnership. Was there a feasible alternative? Justify your view. 9
Why BP choose Joint Venture 9
Risk in Joint ventures 10
Alternative to JIV 11
By applying appropriate theory, compare andcontrast the national and corporate cultures involved. Critically evaluate the actual and potential impact of both on this partnership. 12
Conclusion 14
Drawing upon academic literature and theory, critically discuss the long-term, strategic effects, both positive and negative, of exchange rate movements on the TNK-BP deal during the exploration/negotiation period and after the deal was agreed. 15PART B 17
Identify three (3) specific aspects or challenges of doing business internationally that you personally have come to appreciate through studying this module. Discuss how these will influence you if you go on to an international business career. 17
Bibliografía 18

Introduction

In the next analysis, it has been prepared for studying the factors about the joint venture of twooil companies. It involves the Russian oil company AAR and the British oil company BP
First part, this joint venture has been analysed using the information of different books, news, case study and journal article in order to discuss the process of this union. Firstly, it is going to start with precedents that led to the union of these companies.
In the second part, it explains four differentchallenges viewed by the author in this joint venture.

PART A
With reference to the academic literature and using your analysis of relevant environmental factors, speculate how and why BP identified AAR as a potential ‘partner’. In which areas are the expected benefits and synergies for both companies involved?

In order to analyse the characteristics of the company´ to understand why theydecided to make a joint venture; macro analysis and also micro it´s necessary.
Macro analysis
Before the joint venture, BP was the 15th in the FT Global 500 (Oil & Gas Industry Profile: Global, 2003), BP was the world's second leading oil, energy and petrochemical companies ; $174.2 billion was the amount of the fiscal year in this company at the end of 2001.

Also, BP has a small group ofsubsidiaries companies, which their purpose is research in different chemistry´s areas.

However AAR emerged from the union of three Russian powerful financial, industries and investment on 2003, which purpose is defend the rights of their shareholders in the oil industry. They were committed to the project including its three Russian subsidiaries (ONAKO, SIDANCO, and RUSIA Petroleum); which theyhave the control in the oil extraction in Kovykta field and the Verkhnechonsk field in Russia.

By applying a PESTEL analysis in order to determine macro environmental factors, the following key factors could be extracted. In this case the most dominant factors would be political/legal, economic, and technological. In the following table each of these factors will be appreciated in detail.Political/Legal Factors | In in the process of entering a new country BP needs to consider local politics and legal factors such as labour law, tariffs, tax policy and environmental law.The special relationship between the Russian administrative institutions with the high class of entrepreneur has become in the main area of the economic a political subject (Yenikeyeff, 2011).Russia privatized...