A true friend of China's silicon sector

Helge Aasen leads Elkem AS' efforts to strengthen Chinese parent Bluestar

On Sept 29, Helge Aasen, 55, a Norwegian corporate executive, was among the recipients of the Chinese government's Friendship Award, the highest honor bestowed on foreigners who make outstanding contributions to China's economic and social development.

As CEO, Aasen oversaw Elkem AS' integration with China National Bluestar (Group) Co Ltd, the State-owned chemical giant that acquired the Norway-based silicon chemicals company in 2011.

Ever since, Aasen has been visiting China frequently for week-long stays to interact with Chinese colleagues, so as to ensure a smooth, seamless fusing of the two organizations. The two corporate cultures had to be blended, the two businesses needed to be combined into one, and refinancing for operations organized - tasks that Aasen accomplished with aplomb.

The merger was critical to the Chinese chemical industry's evolution. As the leader of a key overseas unit of the State-owned company, Aasen faced unprecedented challenges, but negotiated them well, which brought about "many happy moments".

Since Bluestar's acquisition, Elkem, which was founded in 1904, has doubled in size, with 2017 sales revenue reaching 21.4 billion Norwegian kroner ($2.63 billion), up nearly 26 percent year-on-year, and operating profit touching 3.2 billion Norwegian kroner, up 104 percent year-on-year.

The solid performance encouraged the company to re-list on the Oslo Stock Exchange in March, making it one of the 20 largest companies on the bourse and making Bluestar a pioneer in the IPO of Chinese companies in Norway.

Although he still pilots Elkem, working under a new Chinese parent "was very different, but it turned out very well", he said.

The acquisition improved parent Bluestar's performance as well. Part of the credit for that went to Aasen, who helped harness synergies between the parent's divisions and Elkem.

The acquisition by Bluestar gave Elkem access to the Chinese market and bolstered it. In tandem with other Bluestar divisions, Elkem helped the parent to foray deeper into the global silicon industry.

The award recognizes his contributions, although he is modest in its acceptance, crediting his team instead. "I feel very privileged to receive this award. It's a fantastic recognition. I am just representing a team. What we have done together with Bluestar is really a big team effort."

Aasen started working with Elkem in 1990. By then, it had been listed on the Oslo bourse for almost 90 years, and was mainly producing ferro alloys and aluminum products.

In 2005, one of the prime shareholders acquired 100 percent stake, which led to its delisting, financial restructuring and overhaul of operations. In 2009, however, the owner decided to sell the company for financial reasons.

In the same year, Aasen was appointed Elkem's CEO. Over the years, he has worked at plants and held corporate roles in and outside Norway, from sales through operations to logistics and purchasing.

When Ren Jianxin, Bluestar chairman at the time of the acquisition, asked him to join the parent's board of directors, Aasen accepted the offer as he saw it as both an opportunity and a challenge.

He wanted to know Bluestar's board more closely and use the experience to forge better relations with colleagues at the parent company. He began frequenting Beijing to improve his understanding of China's corporate culture and deepen cooperation.

"Bluestar is very growth-oriented, like most Chinese companies that are very much focused on top-line growth, and is also keen to establish an integrated value chain," Aasen said. In contrast, before the acquisition, Elkem was more short-term oriented financially, with focus on operational excellence and continuous product improvement.

Since 2011, however, the two organizations have seen a lot of exchange of human resources. He and many professionals from Elkem came to China to help with silicon projects and introduce advanced management tools, including Elkem Business System, a set of fundamentals or principles on how to work to achieve common goals and continuous improvement.

"In the seven years that Elkem has been owned by Bluestar, the parent focused more on improving operations and cost efficiency unless it was investing for growth," he said.

More importantly, Elkem, led by Aasen, helped consolidate Bluestar's worldwide integrated value chain in silicon and silicone sectors. This it did by taking in silicon and silicone divisions of Bluestar and forging stronger competence in the global market.

As soon as Elkem was acquired by Bluestar, Aasen started to work on integrating Elkem and two other silicon divisions of Bluestar. The plan was to expand Elkem's integrated silicon and silicone value chain, which was completed in 2017.

Elkem acquired Norwegian solar photovoltaic panels company REC Group in May 2015, which leads in Europe, and then took over Bluestar Silicones International or BSI in August, becoming a vertically integrated silicon and silicone player with a fully integrated value chain, from upstream quartz mining and silicon to downstream silicone special-ties, and specialized foundry alloys and carbon materials.

Elkem also has strengthened its research and development of new products and technologies, under financial support from the parent. Its annual solar-grade polysilicon output increased from 6,000 metric tons to 8,000 tons after the parent invested $200 million in 2014, while reducing the production cost from $30 per kilogram to less than $10.

Elkem has 28 production sites and an extensive network of sales offices and agents around the world. It has "a fantastic opportunity" to continue to grow, because it is the top player in China with a market share of 15 percent, while China has the fastest-growing silicone market in the world, he said.

However, Aasen wants the company's silicon and silicone business to grow more across specialized product areas such as automotive electronics, home and personal care, and healthcare, from mainly supplying to the construction sector.

Aasen believes it is vital to protect environment. In 2017, the company's subsidiary Elkem Solar was awarded "Norwegian Climate Business of the Year", because it has lowered emissions remarkably, with reduced energy consumption and increased cost efficiency in the production process.

Elkem has reduced its carbon dioxide emission from fossil carbon by 20 percent, and aims to reduce 40 percent by 2030 through energy efficiency and converting to biocarbon, Aasen said.

Chairman Ning Gaoning of Bluestar's parent company China National Chemical Corp spoke high of Aasen's contribution of Elkem and Bluestar.