New BHP boss heralds ‘timely’ shake-up

The Star Early Edition - - COMPANIES - Bloomberg

BHP BIL­LI­TON’S new chair­per­son is about to shake things up at the world’s largest min­ing com­pany, ac­cord­ing to as­set man­age­ment firm San­ford C Bern­stein which, says Ken MacKen­zie, will prob­a­bly un­der­take a full-scale re­view of as­sets and strat­egy, and may de-merge the petroleum busi­ness. “De­spite man­age­ment’s re­luc­tance to change at this stage, we believe BHP is about to ex­pe­ri­ence a rad­i­cal shift in strat­egy, driven by the ar­rival, ef­fec­tive Septem­ber 1, of the new chair­man,” an­a­lysts in­clud­ing Paul Gait said. MacKen­zie used to run a pack­ag­ing busi­ness, and his “de­tach­ment from the min­ing sec­tor makes him, we believe, in­evitably far more ob­jec­tive on the best di­rec­tion BHP should take”.

The group has been the tar­get of an ac­tivist in­vestor cam­paign re­cently spear­headed by El­liott Man­age­ment, which has rounded on man­age­ment de­ci­sions that the fund claims have de­stroyed about $40 bil­lion (R535bn) in value.

MacKen­zie’s ar­rival to re­place Jac­ques Nasser has been wel­comed by El­liott, and Bern­stein said it un­der­stands the in­vestor and MacKen­zie share views.

“We wel­come the ar­rival of a chair­man who is de­tached from in­dus­try pres­sures, can take a fresh look at the BHP port­fo­lio and is un­en­cum­bered by the need to de­fend legacy in­vest­ment de­ci­sions,” Gait said.

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