SAO PAULO – Vale SA surprised investors with the appointment of Fabio Schvartsman as chief executive officer on Monday, choosing a commodities industry veteran to lead transformation of the world’s No. 1 ore producer into a company with dispersed share ownership.
Schvartsman, who has been the CEO of Klabin SA, Brazil’s largest paper and cardboard producer, for the past six years, had not figured in media reports as a potential replacement for CEO Murilo Ferreira. The departure of Ferreira was announced last month.
In a career spanning four decades, Schvartsman occupied key positions in companies such as fuel distribution giant Ultrapar Participações SA, phone carrier Telemar Participações SA and U.S. oil driller San Antonio International. Vale’s board picked him from a list prepared by executive recruiting firm Spencer Stuart.
Schvartsman faces the task of engaging Vale’s investors in a plan to phase out a 20-year controlling shareholder pact and merge the company’s two classes of stock into a single one. The plan was announced last month, the same day that Ferreira announced he would quit when his term expired in late May after six years at the helm of the mining giant.
A more dispersed shareholder structure is key to enhancing transparency and stifling interference from politicians, who for years have pressed Vale to invest in non-core projects. Some top shareholders proposed that Ferreira stay in the job for another year, Reuters reported in January.
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