independent

Friday 18 April 2014

Rio Tinto boss forced out as mine giant takes €11bn charge

THE boss of mining giant Rio Tinto was ousted today after the company disclosed an €11bn charge relating to two major acquisitions.

The surprise resignation of Tom Albanese, who has been chief executive since 2007, stems from a substantial write-down on the value of its aluminium assets and on the 2011 purchase of a coal business in Mozambique.

Rio said the mining industry veteran had stepped down by "mutual agreement" and will be replaced by iron ore boss Sam Walsh.

He has carried the can for Rio's ill-fated acquisition of aluminium group Alcan in 2007, which has generated big losses for the company in recent years due to the economic downturn.

In today's update, Rio said it was writing down the value of its aluminium assets in the range of 10 billion to 11 billion dollars (€7.5bn to €8.2bn).

However, chairman Jan du Plessis described the scale of the $3bn (€2.4bn) write-down on the recent deal for the Mozambique-based coal miner Riversdale as "unfortunate".

He added: "We are also deeply disappointed to have to take a further substantial write-down in our aluminium businesses, albeit in an industry that continues to experience significant adverse changes globally."

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