Xstrata finance chief Reid to quit after completion of Glencore mega-merger

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, 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 Kalmin joined Glencore's coal unit in 1999 and was promoted to his current position in 2005.

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.

The payouts were so controversial that Xstrata chairman Sir John Bond dramatically fell on his sword as soon as investors approved the deal last month.

Mr Reid has been a key architect of the present day Xstrata, working alongside Mr Davis to transform the company from a $500m (£310.6m) ferrochrome and zinc business into a diversified mining group with a market value of $50bn in the space of a decade.

They did this by embarking on an acquisition spree which included 40 takeovers valued at more than $35bn – before crowning things with the Glencore deal.

Mr Reid, 51, will stay in his job until the deal clears the remaining regulatory hurdles, which is expected in the first few months of next year. He will work as a consultant for up to six months after Glencore Xstrata is formed, but will not take up the role of chief financial officer.

Xstrata and Glencore declined to comment on a likely replacement for Mr Reid.

He is entitled to his £5.45m termination package as part of his employment contract which provides for a payment of one-year's salary, bonus and other benefits if he ends his contract following a change of control at the company.

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

Start your day with The Independent, sign up for daily news emails
Sport
England's women celebrate after their 3rd place play-off win against Germany
Women's World CupFara Williams converts penalty to secure victory and bronze medals
Arts and Entertainment
Ricardo by Edward Sutcliffe, 2014
artPortraits of LA cricketers from notorious suburb go on display
News
newsHillary Clinton comments on viral Humans of New York photo of gay teenager
Arts and Entertainment
The gang rape scene in the Royal Opera’s production of Gioachino Rossini’s Guillaume Tell has caused huge controversy
music
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'
10 best statement lightbulbs

10 best statement lightbulbs

Dare to bare with some out-of-the-ordinary illumination
Wimbledon 2015: Heather Watson - 'I had Serena's poster on my wall – now I'm playing her'

Heather Watson: 'I had Serena's poster on my wall – now I'm playing her'

Briton pumped up for dream meeting with world No 1
Wimbledon 2015: Nick Bollettieri - It's time for big John Isner to produce the goods to go with his thumping serve

Nick Bollettieri's Wimbledon Files

It's time for big John Isner to produce the goods to go with his thumping serve
Dustin Brown: Who is the tennis player who knocked Rafael Nadal out of Wimbeldon 2015?

Dustin Brown

Who is the German player that knocked Nadal out of Wimbeldon 2015?
Ashes 2015: Damien Martyn - 'England are fired up again, just like in 2005...'

Damien Martyn: 'England are fired up again, just like in 2005...'

Australian veteran of that Ashes series, believes the hosts' may become unstoppable if they win the first Test