Turquoise Hill appoints Ulf Quellmann as CEO
The board of Turquoise Hill Resources announced the appointment of Ulf Quellmann as CEO, effective August 1.
“Ulf Quellmann is a seasoned executive with extensive knowledge of Oyu Tolgoi and more than 20 years’ experience in corporate finance, strategy, treasury and investor relations at General Motors, Alcan and Rio Tinto,” Turquoise said in a statement.
He was appointed to the Turquoise Hill board of directors in May 2017 and will continue to serve as a member of the board, as well as continue to be part of the Turquoise HillRio Tinto negotiating team working with the government to conclude the sourcing of domestic power.
Most recently, Quellmann served as vice president of Strategic Projects of Rio Tinto’s Copper and Diamonds product group, after serving as chief financial officer of the same group, which has gross annual revenues of nearly five billion USD and investments in three of the world’s Tier 1 copper mines, including Oyu Tolgoi. From 2008 to 2016, Quellmann was group treasurer at Rio Tinto and led the arrangement of the 4.4 billion USD project finance facility for Oyu Tolgoi.
“The combination of Ulf’s experience, project knowledge, leadership capabilities and relationships will enable us to continue making progress towards achieving Oyu Tolgoi’s full potential as one of the world’s largest copper mines,” said Peter Gillin, chairman of Turquoise Hill. “Ulf is very familiar with our project and has important relationships with the operator, the government of Mongolia and other key stakeholders. He is an ideal leader who can bring both an independent perspective and continuity to the CEO role.”
“I welcome the opportunity to lead Turquoise Hill’s strong management team and to continue to work with our partners in the government of Mongolia and Rio Tinto. My priorities will be to drive continued progress at Oyu Tolgoi, build sustainable and respectful relationships with our partners and work to create superior value for all Turquoise Hill shareholders,” said Ulf Quellmann.
The board of Turquoise said it conducted a comprehensive CEO search process with the assistance of a leading independent executive search firm.
The terms and conditions of Ulf Quellmann’s appointment are designed to further align management’s interests with the interests of all Turquoise Hill shareholders, Turquoise said.
Specifically:
Turquoise Hill’s CEO will have a direct employment agreement with Turquoise Hill Resources;
The CEO will continue to serve at the direction of, and will be accountable exclusively to, the Turquoise Hill board of directors, a majority of whom are independent; The CEO’s long-term incentive compensation is to be issued exclusively and entirely in Turquoise Hill Performance Share Units;
The CEO will receive a signon bonus to be solely invested in Turquoise Hill common shares.
On July 1, Turquoise Hill Resources appointed Chief Financial Officer Luke as interim CEO.
The company announced the retirement of its former CEO Jeff Tygesen in May. The board of directors divulged that it was in the process of considering suitable candidates, including those from Rio Tinto.
The second-largest shareholder of Turquouse Hill Resources, Sailing Stone Capital Partners, recently called for the appointment of a “truly independent” CEO and management.
Sailing Stone Capital Partners, an employee-owned US based investment group, which holds an 11.3 percent stake in Turquoise Hill, has been critical of the majority owner Rio Tinto for exerting too much influence on the Oyu Tolgoi mine. The minority shareholder called on the company to appoint a truly independent chief executive that is not a seconded Rio Tinto executive.
“The recent retirement of Turquouse Hill’s CEO, Jeff Tygesen, provides you with an opportunity to accelerate the transition towards a governance structure which is more consistent with a standalone, publicly traded company,” Sailing Stone said in a US regulatory filing, the Financial Times reported.
With the appointment of Quellmann, Turqouise Hill made sure to underline that the aforementioned terms and conditions are designed to further align the management’s interest with the interests of all Turquoise Hill shareholders. This is likely in response to the concerns raised by its second biggest shareholder.
Sailing Stone said in its filing that the conflict of interest has negatively affected the share price of Turquoise Hill, which underperformed its peers even though it has a controlling interest in one of the world’s biggest copper deposits.
...Ulf is very familiar with our project and has important relationships with
the operator, the government of Mongolia and other key
stakeholders...