Newcrest Mining Ltd. (NCM) Chairman Don Mercer should step down after the company this month flagged it will take a A$6 billion ($5.69 billion) writedown, according to the Australian Shareholders’ Association.
“He’s been the chairman for many years, billions of dollars have been lost, he should be held to account,” Stephen Mayne, an association spokesman said today in a phone interview. “He shouldn’t be in charge at this year’s annual general meeting.” Mercer’s office and Newcrest spokeswoman Kerrina Watson didn’t immediately respond to phone calls seeking comment.
Newcrest, Australia’s largest gold producer, has seen its market value fall more than A$2.6 billion this month to A$8.55 billion on June 18., less than the A$9.7 billion it paid to acquire Lihir Gold Ltd. in 2010. The board needs to find a successor to Mercer, a former chief executive officer of Australia & New Zealand Banking Group Ltd. (ANZ), who shouldn’t seek re-election at the shareholder meeting on Oct. 24, Mayne said.
“It’s a straight forward example of accountability for poor performance,” Mayne said. “He was the chairman when the Lihir Gold takeover was done, they’ve now written off billions of dollars related to that.”
Newcrest said its expected writedown will include all A$3.6 billion of goodwill for the Lihir mine in Papua New Guinea.
The association represents and votes on behalf of small Australian investors in companies, including Newcrest. At the gold producer’s 2012 annual general meeting, it voted on behalf of 277 investors holding 388,288 shares, according to the association’s website. The company has 766.5 million shares outstanding, according to data compiled by Bloomberg.
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