Senin, 25 Juni 2012

Miner Mick Davis 'should resign' claims leading Xstrata shareholder

Miner Mick Davis 'should resign' claims leading Xstrata shareholder

By Rob Davies

PUBLISHED: 16:05 EST, 25 June 2012 | UPDATED: 16:05 EST, 25 June 2012

Merger sparks fly at Glencore and Xstrata

Xstrata boss Mick Davis should resign after losing investors’ trust over more than £200m in ‘money-for-nothing’ bonuses tied to the miner’s merger with Glencore, a leading shareholder has said.

Standard Life’s head of equities, David Cumming, said it was probably ‘too late’ to salvage relations with investors by revising the pay arrangements.

He said Xstrata’s top staff might instead have to ‘hand over to Glencore, make it a takeover rather than a merger and that might involve Mick Davis actually standing down’.

He added: ‘Without that change of tack I just don’t see how the deal can actually go through now, there’s just no support for the deal as it stands and the credibility of Xstrata’s board and management team aren’t there any more.’

Speaking on Radio 4’s Today programme, he added that any shareholder who approves the terms would be ‘voting to kill the shareholder spring stone dead and, to be honest, will destroy any credibility they have in the governance arena […].’

Xstrata (down 22.3p to 794.20p) has insisted that the loyalty payments, including £30m for Mick Davis alone, are needed to make sure enough of its top staff stay on to prevent the deal becoming a disguised takeover by Glencore.

But Cumming’s comments suggest some inv estors would be happy to consider a new deal â€" in which Glencore makes a full-blown takeover bid on improved terms â€" rather than stomach the payments.

Insiders said Glencore boss Ivan Glasenberg was unhappy with how Xstrata had handled the sensitive issue of pay, causing friction with his long-time acquaintance Davis.

Glasenberg has made a series of comments recently taking a dim view of lavish payouts for executives.

At a recent industry bash, the multibillionaire South African said Sir Martin Sorrell, boss of advertising giant WPP, should step down if he lost a vote on pay.

Sorrell lost the vote and the company is in discussions over a revised pay deal.

Standard Life has already been joined in its public display of dissent against Xstrata by Fidelity, which called the retention bonuses ‘provocative and insensitive’.

Glencore’s shares lost 4.5p to 308.025p.


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