Speculation over who will succeed Cynthia Carroll as Anglo American’s chief executive ended today as AngloGold Ashanti boss Mark Cutifani was appointed to what has been dubbed “the toughest job in mining”.
Investors welcomed the appointment of Cutifani, who stands to make up to £10.8 million in his first year in the job through salary, bonus and other payments, sending Anglo American’s shares up 48p, or 2.4%, to 2048.5p.
“He seems to tick all the boxes. He has had an international presence and experience of running a significant public company. He has South African experience and he is a mining engineer, so he knows his stuff. He is a mining man,” said Charles Stanley analyst Tom Gidley-Kitchin.
Cutifani, a straight-talking 54-year-old Australian father of seven who has run South Africa’s AngloGold for five years, will take over from Carroll on April 3.
Before joining AngloGold, Cutifani was chief operating officer of the nickel-mining operation of the Brazilian mining giant, Vale, and was previously managing director of Australian gold and tantalum miner Sons of Gwalia.
Credited with increasing production capacity at AngloGold to benefit from record gold prices at the same time as significantly improving the group’s profit margins, Cutifani, pictured, will face a series of fresh challenges in his new job which is regarded as being particularly tough, even by the standards of the mining industry.
His chief task will be to reverse the decline in Anglo American’s shares, which lost about $14 billion (£8.7 billion) of their value under Carroll’s five-year reign and have slumped by 17% in the past two years.
To do this, he will need to address a series of problems which overwhelmed Carroll. These include reining in costs at the group’s Minas Rio iron-ore project in Brazil, which is billions of pounds over budget and five years behind schedule and improving the performance of its ailing platinum division, Anglo American Platinum (Amplats). This has been battered by a series of strikes across the South African mining industry last year, in confrontations that left more than 40 dead, as well as escalating costs and weak demand for platinum.
His pay package includes a £1.2 million basic salary, a compensation award of £2.38 million for payments he forfeited at AngloGold, and a long-term incentive plan worth up to 3.5 times his salary.