Rio Names Chris Lynch as CFO to Replace Elliott
Rio Tinto Group (RIO), the world’s second- biggest mining company, named Christopher Lynch, a former BHP Billiton Ltd. (BHP) executive, as chief financial officer to replace Guy Elliott who announced his retirement in July.
Lynch, 59, was CFO at BHP for six years, London-based Rio said today in a statement. He left in 2007 after missing out to colleague Marius Kloppers for the job of chief executive officer of the Melbourne-based company. Elliott, 57, has served for more than a decade as CFO.
“During his time at BHP, I always liked him as CFO because he was on top of the numbers,” Paul McTaggart, a Sydney-based resources analyst at Credit Suisse Group AG, said by phone. “He was a straight talker and a good risk manager.”
After leaving BHP, Lynch became CEO of Australian toll road company Transurban Group (TCL), rejecting a A$7.2 billion ($7.4 billion) takeover bid from the company’s three biggest shareholders in 2010. He left Transurban in July.
“Chris Lynch is an extremely high-caliber addition to our executive team,” CEO Sam Walsh said in the statement. Lynch, a non-executive director of Rio, has “a strong pedigree of board, mining and financial experience,” he said.
Rio gained 1.6 percent to A$67.05 at the close of trading in Sydney. The benchmark index rose 1.3 percent.
“This is a wonderful opportunity for me to join Sam’s leadership team and work with him in refocusing the business on pursuing greater shareholder value,” Lynch said in the statement. “I am really looking forward to getting stuck into the challenge and ensuring we deliver on our promises to improve this great business.”
Rio this month announced its first-ever annual loss after taking a $14 billion writedown on the value of its aluminum and coal assets. The asset impairments cost CEO Tom Albanese his job, as well as head of strategy Doug Ritchie.
Rio will also cut its executive committee by two positions to nine, according to the statement. The company won’t fill the strategy role and will restructure Bret Clayton’s role of group executive, business support and operations, it said. Clayton will stay with Rio and continue to oversee the divestment of the Pacific Aluminium unit.
Elliott was part of the team that executed the $38 billion cash takeover of aluminum maker Alcan Inc. in 2007, which soured when metal prices plunged during the global financial crisis. The deal forced Rio into asset sales and a capital raising after debt ballooned to $40 billion.
Last year, Elliott and Albanese waived their annual bonuses following a $8.9 billion after writing down the value of its aluminum unit. During Elliott’s tenure, Rio’s net income rose almost ninefold to $5.8 billion until 2011 as commodity prices rose.
To contact the reporter on this story: Elisabeth Behrmann in Sydney at email@example.com
To contact the editor responsible for this story: Jason Rogers at firstname.lastname@example.org