Kazatomprom (KAP.IL): higher turnover than your local McDonald's?
Kazatomprom (KAP.IL) is a uranium giant, accounting for 40% of the world’s uranium production alone. Yet, its management resembles that of a struggling restaurant chain.
Often cited as a privatization success story in Central Asia since its initial public offering in 2018, the company remains heavily influenced by the Kazakh state, which retains a 75% ownership stake. As a result, KAP often finds itself at the heart of internal quarrels in Kazakh politics. Kazakhstan, long regarded as a model of stability in Central Asia, tasted in 2022 its first major popular uprising. Widespread protests erupted across the country over rising energy prices and economic dissatisfaction.
While life returned to normal in the country, tensions persist, exacerbated by growing global geopolitical pressure. And the fractures are evident at the highest levels of governance of Kazatomprom. High turnover would be an understatement to describe the alarming pace of managerial change within the company.
This is going to be a rather long article because the company changes management more frequently than some people change their underwear and I believe it’s necessary to show the full story to convey the seriousness of this issue.
Following the IPO and first adjustments in 2019, Kazatomprom’s management team consisted of:
Galymzhan Pirmatov, Chief Executive Officer and Chairman of the Executive Board
Bayrzhan Ibrayev, Chief Nuclear Fuel Cycle and Atomic Energy Officer
Riaz Rizvi El Hasan Sayed, Chief Strategy and Marketing Officer
Birzhan Duisembekov, Chief Business Support Officer
Dauren Kunanbayev, Chief Operations Officer
Meirzhan Yussupov, Chief Financial Officer, and
Beksultan Bekmuratov, Chief Transformation and IT Officer
With this team, the company made major advancements across all segments and was able to deliver more than 100% in share price appreciation by 2021. So far, so good.
However, major changes were made in early 2021 when CFO Meirzhan Yussupov resigned, CNFCO Baurzhan Ibrayev retired, CCO Riaz Rizvi stepped down, and CSDO Birzhan Duisembekov took a study leave. Following the above changes, only Galymzhan Pirmatov, Dauren Kunanbayev, and Beksultan Bekmuratov remained from the original team.
In September 2021, CEO Galymzhan Pirmatov also departed from his role, and Mazhit Sharipov, who was Kazatomprom’s Chief Nuclear Fuel Cycle Officer at the time, was appointed acting CEO. Other changes included the appointment of Dosbolat Sarymsakov as Interim Chief Nuclear Fuel Cycle Officer, as well as the departure of COO Askar Kassabekov. At this point, only Beksultan Bekmuratov was still there from the original members. However, within the same month, he also resigned, and the CHRCO position was eliminated. Additionally, Aliya Akzholova was replaced by Aslan Bulekbay. Bulekbay resigned in March 2022, after just half a year. Whenever managers leave the company, the news reports state that they did it to “pursue other opportunities” or for “personal reasons.” But I think there are some serious issues within the organization. Either way, it took only 2 years, and we already have a completely new company. But the story doesn’t end here.
In July 2022, CEO Mazhit Sharipov departed and resigned from Kazatomprom’s Board of Directors for personal reasons and was replaced by Yerzhan Mukanov. Isn’t that a rather short stay for a CEO?
At the end of 2022, Kamila Syzdykova, Kazatomprom’s CFO, who was at the time on parental leave since November, decided not to return and departed from her role. Additionally, Askar Batyrbayev decided to leave his role as CCO. In January 2023, Ruslan Beketayev was appointed as CFO, and Alisher Taizhanov was appointed as CCO.
In May 2023, Neil Longfellow announced his decision to resign from his position as an independent Director and Chairman of the Board of Directors. Not much of a long fellow, after all. In the same month, Marat Yelemessov, who was on “study leave” since 2021, resigned too and was replaced by Kazbek Shaimerdinov. Additionally, Alisher Taizhanov resigned from the position of CCO (after only three months) and was replaced by Dastan Kosherbaev. One month later, Marc Kasher announced his decision to resign from his position as an independent Director of the Board of Directors of the Company. It is worth noting how new members frequently leave very soon.
Also in June, following the election of a new board of directors, Dastan Kosherbayev (CCO), Kuanysh Omarbekov (COO), and Mukhit Magazhanov (Head of Administration) were added to the Company’s Management Board.
In August 2023, Kazatomprom announced the consolidation of two business units, the production unit and the nuclear fuel cycle (NFC) unit, into a single business area under the supervision of the Chief Operating Officer. As a result of this restructuring, Dosbolat Sarymsakov's term on the Management Board was terminated, and the position of Chief NFC Officer was abolished entirely. At least he got to stay for two years. Compared to September 2021, the Management team again changed almost completely, in just under two years.
In October 2023, Yerzhan Mukanov departed from his roles as CEO and Chairman and resigned from Kazatomprom’s Board of Directors. Consequently, Meirzhan Yussupov became Kazatomprom’s new CEO. Additionally, the Board appointed CFO Sultan Temirbayev as a member of the Management Board.
In the spring of 2024, Mukhit Magazhanov resigned from his roles (after less than a year) and was replaced by Darkhan Sagindykov. Additionally, Kazatomprom appointed Vladislav Baiguzhin, the Company’s new CCO since April, as a member of the Management Board. In June, the Company then increased the number of Board members from seven to eight, and elected Mr. Zhanat Umerbekov, the Company’s Managing Director for HR and HSE, as a member of the Management Board. Notably, before his appointment in 2023 as a Managing Director for HR and HSE at Kazatomprom, Mr. Umerbekov worked in public service.
In October 2024, Kazatomprom announced yet another significant management change when the Board of Directors elected Marat Tulebayev, Kazatomprom’s CFO, as a member of the Management Board. Former CFO Sultan Temirbayev was “formally excluded” from the Management Board following his resignation. Only one year after being added to the Board.
Since then, Kazatomprom's Management Board has consisted of:
Meirzhan Yussupov, Chief Executive Officer;
Marat Tulebayev, Chief Financial Officer;
Kuanysh Omarbekov, Chief Operating Officer;
Dastan Kosherbayev, Chief Strategy and International Development Officer;
Vladislav Baiguzhin, Chief Commercial Officer;
Yermek Kuantyrov, Chief Legal and Corporate Governance Officer;
Darkhan Sagindykov, Chief Procurement and General Affairs Officer;
Zhanat Umerbekov, Managing Director for HR and HSE.
As you can see, you may buy into the stock now, and a year later, you own a different company. This is inconvenient for investors, who often consider Management a major factor when buying a company. Additionally, many of these changes occurred since the Kazakh unrest of 2022, and with some of the new members having a background in public service, this merits caution. One should certainly keep this in mind when considering investing in Kazatomprom, especially with the talks of nationalization in the background. It almost looks as if the management is being infiltrated with ex-government workers to support nationalization efforts later, which would maybe have been opposed by some of the managers who “left.”