Glencore Names Hayward Interim Chairman After Bond Ousted at AGM

Glencore Xstrata Plc (GLEN) appointed former

BP Plc (BP/) Chief Executive Officer Tony Hayward as interim chairman

after John Bond was ousted by shareholders of the world’s

largest exporter of power-station coal.

Bond stepped down at the start of Glencore’s annual general

meeting today in Zug, Switzerland, saying he didn’t have enough

support. Shareholders voted 80.85 percent against his selection,

Glencore said in a statement later. The company is seeking

candidates and consulting with major external shareholders, and

Hayward will step down once a replacement is found, it said.

Glencore, the largest exporter of power-station coal,

completed the $29 billion acquisition this month to create the

world’s fourth-biggest mining company, with a market value of

about $68 billion. The ousting of Bond and director Steve Robson, who also announced he was quitting today, adds to a list

of Xstrata executives who departed in recent months as the

completion of the takeover neared.

Bond, 71, said in November he wouldn’t take on the role of

chairman as planned and would leave once the board created by

Glencore’s takeover of Xstrata Plc found a replacement. Glencore

shareholders also today rejected former Xstrata board members

Ian Strachan, Con Fauconnier and Peter Hooley as directors. The

remuneration report was passed, with 22 percent opposed.

Glencore, based in Baar, Switzerland, gained 0.4 percent to

335.20 pence by 12:56 p.m. in London trading. The largest

publicly traded commodities supplier, may consider a listing of

shares in Switzerland, Chief Executive Officer Ivan Glasenberg

told the meeting today in response to a question from an

investor.

Macondo Well

Hayward, 55, is the CEO of Genel Energy Plc (GENL), the largest

oil producer in Iraq’s Kurdish region. He resigned from BP,

Europe’s second-biggest energy company, in October 2010

following the Gulf of Mexico disaster. The Macondo well exploded

on April 20, 2010, killing 11 workers on the Deepwater Horizon

oil platform and unleashing the worst offshore oil spill in U.S.

history.

He teamed up with financier Nathaniel Rothschild to create

Vallares Plc, a shell company that raised 1.33 billion pounds

($2 billion) through an initial public offering in London in

June 2011. Vallares agreed to merge with Genel in September

2011.

Mick Davis, the 55-year-old former CEO of Xstrata, said

last month he won’t serve six months in the role at the new

company before handing over to Glasenberg as previously

announced.

Xstrata Departures

Senior Xstrata executives including Charlie Sartain, head

of copper, nickel chief Ian Pearce and Loutjie Smit, interim CEO

of Xstrata alloys, have also departed. Strategy and corporate

affairs head Thras Moraitis and chief legal counsel Benny Levene

will leave after acting as consultants for six months.

Xstrata Chief Financial Officer Trevor Reid said in

December he won’t stay on at the combined company.

Bond announced his intention to resign after investors

defied the Xstrata board’s recommendation to approve a 144

million-pound ($219 million) package of retention bonuses for

about 70 Xstrata managers.

The proposed payments were criticized for being offered

without any performance criteria. Xstrata in June amended the

package, making all bonuses payable in shares and linking

payments to the executives to cost-saving targets. Bond handed

control of today’s AGM to Hayward as the meeting opened.

“I recognise and respect the strong opposition among many

to the retention arrangements which the board felt appropriate

to ensure management stability,” Bond said in a statement

today. “As I and my fellow directors depart the Board, we offer

our best wishes to Ivan Glasenberg and his team as they start

the work on combining these two exceptional companies.”

Vodafone, HSBC

Bond was chairman of Vodafone Group Plc (VOD) from 2006 until

2011. He had held the same post at HSBC Holdings Plc after

joining the lender more than 40 years earlier.

Glencore Xstrata has interests in about 35 coal mines in

Colombia, Africa and Australia, accounting for about 10 percent

of global seaborne supplies of the fuel. It is the fourth-biggest producer of mined copper and third-largest in nickel,

and employs about 190,000 people in more than 50 countries

across its industrial and trading divisions.

Glasenberg told analysts this month he expects to generate

synergies “well above” the stated target of $500 million a

year. He plans to close Xstrata’s Zug and London offices, and

plans regional centers in Sydney, Johannesburg, Toronto,

Stamford and Singapore.

Cost Savings

The group may save $150 million a year by eliminating

Xstrata’s London office, Credit Suisse Group AG analysts said

this month. They estimate possible cost savings of $1 billion a

year by 2015.

The company has retained two former Xstrata executives as

division heads among its 14 senior managers.

“We expect Glencore senior management to dominate the new

board and we expect them to impose Glencore’s leaner corporate

structure,” Liam Fitzpatrick, Michael Shillaker and James Gurry, analysts at Credit Suisse, wrote in a report this month.

The new company may cut duplication and management costs by $200

million to $300 million a year at its copper, coal and zinc

units, they said.

To contact the reporter on this story:

Jesse Riseborough in London at

jriseborough@bloomberg.net

To contact the editor responsible for this story:

John Viljoen at

jviljoen@bloomberg.net

Glencore Names Hayward Interim Chairman After Bond Ousted at AGM