Guinea blames feud for firing of Rio executives
The president of Guinea is disputing statements made by Rio Tinto regarding the firing of a senior executive for a $10.5m payment made to the president’s friend Francois de Combret.
President Alpha Conde said the firing of Alan Davies, who headed Rio’s $20bn Simandou iron-ore project in Guinea, was the result of an internal feud. Rio has said it was because of improper payments to De Combret in 2011 for assisting the company’s negotiations with Conde on the mine.
Davies had been seen as a challenger to Jean-Sebastien Jacques prior to the Frenchman becoming CEO in July.
“In reality, it was a settling of scores because the new CEO wanted to get rid of Alan Davies,” Conde said in an interview in Davos, Switzerland.
In November, Rio alerted authorities, including the US department of justice and the
UK’s Serious Fraud Office, to a $10.5m payment made in 2011 to De Combret, a veteran French investment banker. The fee was compensation for his assistance in negotiations with Conde, a university friend, after Rio agreed to pay Guinea $700m to retain its licences there.
Davies and De Combret declined to comment. Davies has previously said there were no grounds to fire him and has vowed to take legal action. Rio also dismissed its head of legal and regulatory affairs following its probe into the payment.
“The decision was taken by the board, under my leadership, following a thorough review of the findings of the comprehensive internal investigation, supported by external counsel,” chairman Jan du Plessis said. “The review demonstrated that both executives had failed to maintain the standards expected of them under Rio Tinto’s global code of conduct. The matter is now with the regulators in the US, UK and Australia.”
SIMANDOU PAYMENT
The payment came to light in late October after internal e-mail correspondence showed Davies explaining to then CEO Tom Albanese that De Combret had provided “very unique” services and had a “closeness to the president” that helped Rio to retain licences.
“He vouched for our integrity when it was needed and helped bring us together when things were looking extremely difficult,” Davies wrote in a 2011 e-mail to the head of the ironore division at the time, Sam Walsh, in which he requested the payment.