BHP starts search for new CEO: report – by Pav Jordan (Globe and Mail – November 8, 2012)

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Marius Kloppers, the energetic chief executive who led the failed charge by Australia’s BHP Billiton Ltd. to acquire Potash Corp. of Saskatchewan, may soon be a free agent.

The Financial Times said on Wednesday that BHP, the world’s largest diversified miner, has begun its search to replace Mr. Kloppers within the next two years, and the company did not deny the reports.

Succession planning for the CEO and senior management team is an on-going process and one of the most critical tasks of any board,” BHP said in an e-mailed statement, adding that it would not comment directly on the Financial Times story.

“BHP Billiton’s Board has always ensured that it has a well-integrated, continual succession process in place for our most senior executives.” Mr. Kloppers, who grew up in apartheid South Africa where he was conscripted into the army at the age of 18, became BHP’s CEO in late 2007, just as the first wave of the financial crisis was washing over global commodity markets.

Now 50, Mr. Kloppers has had a rough ride of it, failing in some key attempts to grow the already giant company through high profile acquisitions that ultimately fell through.

In 2010 the Canadian government prevented a hostile, $39-billion takeover of Potash Corp. on the grounds it would not have been of net benefit to Canada.

The rebuttal was egg on the face to Mr. Kloppers and an end to what would have been a quick entry for BHP into the ranks of major producers in the agricultural sector, one of the few where it is not yet a player.

BHP has since opted for a greenfield entry into the sector, and is building a potash mine in Saskatchewan that promises to be the world’s largest once complete.

More recently, Mr. Kloppers waived his 2012 bonus after coming under fire in August for a $2.8-billion writedown on U.S. shale gas assets acquired for nearly twice that amount 18 months earlier.

“The move cannot be considered surprising, given some of the criticism that Mr. Kloppers has attracted from shareholders over the failed bids for Potash Corp and Rio Tinto and US shale gas writeoffs,” said BMO Nesbitt Burns analyst Tony Robson, pointing out in a report that Mr. Kloppers could be viewed to have outperformed his peers at other major miners since the financial crisis took hold.

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