Nyrstar Names Trafigura's Eger CFO as Trader's Influence Grows

  • Eger replaces Eigner, who leaves Nyrstar by end of year
  • Eger was previously a senior M&A executive at Trafigura

Nyrstar NV named Trafigura Pte Ltd.’s Christopher Eger chief financial officer as the commodity trader tightens its control of Europe’s largest refined-zinc producer before a share sale next year.

Eger replaces Heinz Eigner, who will leave the company at the end of the year, Nyrstar said in a statement on Friday. Eger, who will also join Nyrstar’s management committee, was part of Trafigura’s mergers and acquisitions team. He previously worked as an investment banker at Bank of America Merrill Lynch and is a former director in the mining group of BMO Capital Markets. Nyrstar shares gained as much as 5.4 percent.

The appointment “shows Trafigura’s influence on Nyrstar,” according to a note from Philip Ngotho, an analyst at ABN Amro Bank NV, who has a sell recommendation on the zinc refiner.

Trafigura may boost its stake in Nyrstar to more than 30 percent by agreeing to purchase as much as 125 million euros ($133 million) of the company’s shares as part of a 250 million euros to 275 million euros rights offering planned for the first quarter. The commodity trader currently holds more than 20 percent of Nyrstar and has two of its nominees on the company’s board. Chief Executive Officer Bill Scotting said on Nov. 9 that Trafigura was “not taking over the company by stealth.”

Nyrstar climbed 5.1 percent to 1.50 euros as of 9:30 a.m. in Brussels trading, paring this year’s losses to 49 percent.

Finance Experience

Eger’s “experience of finance and capital markets brings considerable additional strength to our efforts to improve the performance of Nyrstar,” Scotting said in the statement on Friday.

Nyrstar approached Trafigura about the CFO position, according to an e-mailed statement from Victoria Dix, a spokeswoman for the commodity trader.

“While we are sorry to lose him, we believe Chris will be a strong CFO due to his extensive finance background and in-depth knowledge of Nyrstar,” she said.

Trafigura has agreed not to raise its equity stake to more than 50 percent of Nyrstar, which is seeking to raise capital to refinance 415 million euros of bonds due in May. Trafigura can boost its stake in Nyrstar to more than 30 percent without having to make an offer to minority shareholders as is usually the case under Belgian law because the increase comes under a rights offer.

As part of the November deal with Trafigura to support the planned rights offering, Nyrstar, which has suffered amid plunging zinc and lead prices, agreed to purchase zinc concentrates from Trafigura and to supply the world’s second-largest metals trader with refined product.

Nyrstar is also planning a 150 million euros to 200 million euros prepay offtake deal for metal with a commodity trader, which “could be Trafigura,” or another trading house, Scotting has said. A zinc offtake agreement with Noble Group won’t be affected by the new agreements with Trafigura.

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