Glencore Xstrata was the subject of a boardroom clear-out as shareholders at the newly formed mining giant moved to punish directors for a controversial multimillion-pound "golden handcuffs" package proposed ahead of the mega-merger.
Its chairman, the City veteran Sir John Bond, was among the former Xstrata directors booted out at the company's first annual meeting since the $67bn (£44bn) tie-up, with 81 per cent voting against his re-election. He has been replaced on an interim basis by Tony Hayward, the former chief executive of BP who quit in 2010 in the wake of the Gulf of Mexico disaster.
Three other former Xstrata directors, Con Fauconnier, Ian Strachan and Peter Hooley, were also ousted, while a fifth, Sir Steve Robson, announced before the meeting that he was resigning from the board.
The revolt came amid continuing anger over a £144m package of retention payments for 70 Xstrata executives which was initially proposed as part of the mega-merger. Sir John had originally insisted these were vital to the success of the tie-up, but was later forced to remove them as a condition of the deal going ahead.
After a vote last November that saw Xstrata investors support the merger but about 87 per cent fail to back the payments, Sir John announced his resignation, although he said he would not leave until a replacement was found.
In a statement after he was ousted, he said he recognised and respected "the strong opposition among many to the retention arrangements which the board felt appropriate to ensure management stability".
The search for a new chairman will be led by Mr Hayward, the senior independent non-executive at the miner, as the head of the nominations board.
His elevation to interim chairman is a dramatic return to the top of a FTSE 100 giant for the ex-BP man, who attracted severe criticism in 2010 for telling reporters in the wake of the Gulf of Mexico oil spill, which caused 11 deaths, that he wanted "my life back." He eventually resigned as BP chief executive, saying he was "demonised and vilified".
Mr Hayward is currently chief executive of Genel Energy, the oil explorer backed by the financier Nat Rothschild. Glencore Xstrata said Mr Hayward would be step down once a permanent chairman was found.
The board clear-out leaves the struggle for power over Glencore Xstrata even more firmly in the hands of Glencore directors and executives, amid concerns over whether a new chairman will be able to provide a balance to the company's chief executive Ivan Glasenberg.
When the merger was originally proposed, the former chief executive of Xstrata Mick Davis was set to head up Glencore Xstrata for six months. However, the terms were later renegotiated and Glencore's boss Mr Glasenberg – who is also its largest shareholder – instead took charge. Meanwhile, nearly 25 per cent of the group is owned by Glencore managers.
"What matters now is to secure the appointment of an independent chairman who commands the support of both external and internal shareholders," said major shareholder Scottish Widows Investment Partnership's Anne Fraser. "The chairman would then be well-placed to lead a refreshment of the board."Reuse content