Antofagasta chief quits after mine let-down
Jim Armitage is the City editor of The Independent and London Evening Standard group of newspapers. He has been a reporter and editor for more than 20 years and was recently shortlisted for the Press Gazette financial journalist of the year and The Society of Editors financial journalist of the year awards. He contributes news, investigative reports and comment to the Independent titles plus a daily column in the Evening Standard.
Thursday 08 March 2012
The chief executive of FTSE 100 copper mining company Antofagasta has resigned after disappointing investors with the slow progress of development of its new £1bn mine in Chile.
News of Marcelo Awad's departure was something of a shock, coming just a week before Antofagasta is due to publish its full-year profit figures.
Despite effectively running the London-headquartered company, Mr Awad was controversially not on the main board of directors. Consequently, he is not required to disclose his pay, bonuses or shareholdings.
Chairman Jean-Paul Luksic, scion of the Luksic family which still owns around 56 per cent of the £12bn company, has taken over operational control while a successor is found.
Antofagasta would not comment on whether, or how much, Mr Awad will get as a payout.
He became chief executive in 2004.
Some observers pointed to the slow progress made in developing the company's fourth major mine in Chile, Esperanza, as the reason for Mr Awad's sudden departure.
"The Esperanza mine is a big project and there has been some frustration that it has taken longer to get into full production than hoped. The feeling is Awad took his eye off the ball," said one investor.
Others claimed that the business, named after the Chilean region where most of its mines are, had begun to look slow-footed compared to rivals such as Rio Tinto, which have pushed into major new projects in Asia and Africa.
Antofagasta refused to give any reason for Mr Awad's departure.
In a bid to stave off concerns about next week's financial results, the company stressed that the figures would be in line with the market's expectations.
Shares in the company fell only 7p to 1230p, as investors took heart at the assurance about profits.
Despite its unorthodox corporate governance, the shares still trade at a premium to rivals because of the company's habit of paying out big dividends to investors.
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