Trevor Reid leaves Xstrata with £5.5 million pay-off

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The Independent Online

Xstrata's chief financial officer, Trevor Reid, is quitting the mining giant with a £5.45m pay-off after announcing his resignation just two weeks after it finally sealed its £56bn mega-merger with commodities trader Glencore.

Mr Reid, 51, who helped transform the mining minnow into a FTSE 100 powerhouse during his 10-year stint as the right-hand man of chief executive Mick Davis, missed out on pocketing up to £11m more after investors rejected a proposed £140m package of retention bonuses for senior management to encourage them to stay on at the combined company for two years.

It is understood that Glencore's chief financial officer, Steven Kalmin, will take up the job instead.

Mr Reid, who also owns 647,365 Xstrata shares valued at £6.6m at last night's closing price, said: "The next phase of Xstrata's evolution is now well under way and following shareholder approval for the merger with Glencore, I have decided to step down on completion of the transaction."

His departure comes at a tough time for the mining industry, which is being squeezed by a combination of falling prices and high labour and machinery costs as the recession hits demand following a period of rapid expansion.

Mr Davis has also said he will quit the company after the merger, meaning that the key architects of Xstrata will both be leaving the group at some point next year.

Neither has said what they will do next, although Anglo American was quick to scotch rumours in October that Mr Davis would become its new chief executive after Cynthia Carroll said she would quit the top job at the mining group.

Mr Reid's resignation also raises concerns among some investors that there could be further departures of senior Xstrata management following the shareholders' vote against the retention payments.

Shares in Xstrata fell by 8p to 1,025.5p, while Glencore's declined by 2.15p to end the day at 341.3p.

Xstrata's chairman Sir John Bond dramatically fell on his sword last month after investors rejected the controversial £140m retention bonus plan.