Rio Tinto to boot iron ore chief in fresh management shake-up
Ten days before officially assuming as the new chief executive officer of Rio Tinto (ASX, LON:RIO), Jean-Sébastien Jacques has begun making major changes at the top level in an effort to improve the company’s balance sheets after a long-drawn-out commodities prices rout.
One of the main announcements the world’s second largest miner unveiled Tuesday was the departure on July 1 of its iron ore division boss Andrew Harding, once tipped as the most likely person to take the company’s reins.
Chris Salisbury, who currently leads Rio’s copper and coal division, will replace Harding, a 25-year veteran at the firm. His division will focus only on Rio’s operations in the Pilbara region of Western Australia, the company said.
Changes are said to be part of Rio's master plan to reduce its reliance on iron ore for profits and become one of the world’s biggest copper producers.
A source familiar with the reshuffle told Reuters that Harding had expressed a willingness to stay on at the job he has held since 2013, but it was agreed that the division would benefit from "fresh eyes".
Jacques, formerly head of the copper and coal unit, was appointed in March to replace current CEO Sam Walsh. Such decision, experts said, was part of a master plan to reduce Rio’s reliance on iron ore for profits and become one of the world’s biggest copper producers.
In fact, Rio’s board last month approved a $5.3 billion expansion to more than double output at the Oyu Tolgoi copper mine in Mongolia.
The change of leadership also came right after the group posted an annual net loss of $866m for 2015 because of tumbling commodity prices that have squeezed both small and big players in the mining sector.
Among the changes announced today, Rio said its copper and diamonds divisions will be combined into a single group, while coal, uranium salt, borates and other units will be combined under a new business branded as “energy and minerals.”
Alan Davies, currently the head of diamonds and minerals, will assume as the head of Rio’s reformed energy and minerals division, losing his diamonds brief, but inheriting energy coal and Iron Ore Company of Canada, and holding on to uranium.
Alfredo Barrios will continue as head of the aluminum division, based in Montreal, Canada.
Arnaud Soirat, 51, will be in charge of copper and diamonds. He is currently chief executive of Rio’s aluminum primary metal business.
Finally, the company’s technology and innovation division – until last month led by former Pilbara mines boss Greg Lilleyman – will be renamed the growth and innovation division. Former exploration boss Stephen McIntosh, acting in the role since the resignation of Lilleyman, has been confirmed as the permanent head of the unit.