Charlotte Mathews
13 July 2009
Johannesburg — INVESTORS welcomed Anglo American's appointment on Friday of a new chairman known to the London investment community, but South African government views were mixed.
The selection of the right candidate is critical at a time when Anglo is facing a merger proposal from rival Xstrata. Although Xstrata's approach has so far been friendly and it has said it wanted to meet the Anglo board , the board has publicly rejected the suggestion of an all-share merger of equals.
Anglo's shares showed approval, closing 2,8%, or 600c, higher at R222 on the JSE and 0,2% up at £16,54 in London.
In SA, investment groups such as Old Mutual and Investec were positive, and Mineral Resources Minister Susan Shabangu said she "welcomed" Sir John Parker's appointment. But Minerals and Energy director-general Sandile Nogxina said he was disappointed that Anglo had not felt it could find anyone in SA of the same calibre .
City Press reported yesterday that businessman Cyril Ramaphosa confirmed he had been offered the chairmanship, but had declined it because of other commitments.
Parker, who will replace Sir Mark Moody-Stuart on August 1, studied naval architecture and mechanical engineering. He has served as chairman of Babcock International, National Grid and P&O. As chairman of RMC Group he led its transformation and sale to Cemex of Mexico in 2005, and as chairman of P&O he led its sale to DP World (Dubai) in early 2006.
Parker said he had deep roots in SA and knew the country well from his Babcock days and from working with Ramaphosa as joint chairman of Mondi .
Old Mutual Investment Group SA (Omigsa) portfolio manager Anwaar Wagner, whose group holds 3% of Anglo American , said it had clearly done its homework. Omigsa complimented management on acting swiftly at this time to find a chairman of such calibre. It had been searching and evaluating candidates for months.
Parker was a highly regarded executive and clearly had a depth of experience and skill across various industries, Wagner said. Parker also had a clear understanding of the dynamics of SA, after having been joint chairman of Mondi, and the necessary merger and acquisition experience that would come into play whether Anglo were a buyer or seller of assets.
If Xstrata improved its merger offer, Parker had the skills to handle that transaction.
Asked about the lack of operational mining experience on Anglo's board, Wagner said that was less of an issue given Parker's depth of experience.
Senior executives had told Wagner "they could not praise Sir John Parker highly enough".
According to Bloomberg, Investec Bank said in a note Anglo's board had moved quickly at a time when the investment community was concerned about Anglo management and the Xstrata proposal. The appointment was "positive" and could lead Anglo to take a different approach to Xstrata.
But Parker's statement on his appointment appeared to support Anglo's strategy and management. He said Anglo had potential to deliver further growth and value in future. He looked forward to working with the board and "excellent management team led by Cynthia Carroll".
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