Glencore Said to Hire Two Xstrata Execs Amid DeparturesJesse Riseborough
Glencore Xstrata Plc hired two former Xstrata Plc executives as division heads amid the departure of a number of senior managers as it completed the takeover of the coal exporter, a person familiar with the matter said.
Telis Mistakidis, Glencore’s existing head of copper, will lead both trading and mining of the metal in the new company, the person said, asking not to be identified as the positions are yet to be announced. Former Minara Resources Ltd. chief executive officer Peter Johnston will head the nickel mining business, the person said.
Xstrata’s Peter Freyberg, who headed the acquired company’s coal unit, will run the mining operations of the group with Tor Peterson continuing to lead coal trading, the person said. Mark Eames, who was chief operating officer of Xstrata’s iron ore division, will lead the new company’s iron ore mining unit, the person said.
Glencore’s acquisition of Xstrata adds coal, copper, zinc and lead mines to its global trading empire and establishes the fourth-biggest mining group. The Baar, Switzerland-based company may save $150 million a year by eliminating Xstrata’s London office, Credit Suisse Group AG analysts said.
Ivan Glasenberg, chief executive officer at the world’s largest publicly traded commodities supplier, wrote to employees yesterday following the completion of the $29 billion takeover, saying a new leadership team had been announced, according to a letter seen by Bloomberg News. He didn’t identify the executives.
A spokesman for Glencore declined to comment on the appointments and departures.
Glencore jumped 5.4 percent to 331.15 pence in London yesterday, the biggest gain since March 5.
The company last month cleared the final regulatory hurdle in a 15-month takeover battle that will see a number of senior Xstrata executives depart. Glencore will start notifying managers of job losses following yesterday’s completion of the deal, according to the letter from Glasenberg.
“By restructuring and refocusing, we will be better able to take advantage of the opportunities that will inevitably present themselves over the coming years to the benefit of all,” Glasenberg wrote. “Those who will be affected within the various management structures will be notified directly and as soon as practicable.”
Mick Davis, the 55-year-old who headed Xstrata from its inception in 2001, will act as a consultant until June 30. Other senior management including Charlie Sartain, head of copper, nickel chief Ian Pearce and Loutjie Smit, interim CEO of Xstrata alloys, were scheduled to leave yesterday.
“We have today announced the new leadership team, along with clear lines of reporting and responsibility,” Glasenberg, 56, wrote in the letter. “For the vast majority of employees, particularly those involved in key front-line processes of production and marketing, there should be little impact on your day-to-day activities.” The letter didn’t specify how many jobs would be cut.
Thras Moraitis, Xstrata’s head of strategy and corporate affairs, and Benny Levene, its chief legal counsel, will also depart after acting as consultants for six months, Xstrata said last month.
“We expect Glencore senior management to dominate the new board and we expect them to impose Glencore’s leaner corporate structure,” Credit Suisse analysts Liam Fitzpatrick, Michael Shillaker and James Gurry wrote in a report. The new company could cut duplication and management costs by $200 million to $300 million a year at copper, coal and zinc units, they said.
Glencore was advised by Citigroup Inc. and Morgan Stanley. Xstrata hired Goldman Sachs Group Inc., JPMorgan Chase & Co., Deutsche Bank AG and Nomura Bank International Plc.
The combined company employs about 190,000 people, including contractors, according to its website.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.