You are here

BHP names packaging guru MacKenzie as new chairman

Friday, June 16, 2017 - 09:56

BHP.jpg
Mining giant BHP on Friday named well regarded Australian packaging executive Ken MacKenzie as its next chairman, handing him the challenge of guiding the company amid calls for change.

[SYDNEY] Mining giant BHP on Friday named well regarded Australian packaging executive Ken MacKenzie as its next chairman, handing him the challenge of guiding the company amid calls for change.

Mr MacKenzie, 53, succeeds Jac Nasser as of Sept 1 at a time when the world's biggest miner is being challenged by activist investors to overhaul its structure and consider dumping its petroleum business or part of it.

Investors welcomed the appointment of Mr MacKenzie, who was considered one of Australia's most successful chief executives in his 10 years at the helm of Amcor. "It's an important first step in the right direction. Hopefully it creates a platform to be able to review what's amiss with the company in the eyes of some and address the concerns," said Brenton Saunders, an analyst at BT Investment Management, which owns shares in BHP.

Mr MacKenzie presided over a long stretch of prosperity at Amcor Ltd, which makes packaging for food producers, industrial companies and pharmaceutical firms, that coincided with the end of a boom period for mining companies.

sentifi.com

Market voices on:

Hedge fund Elliott Management has fired a barrage of criticism against Nasser and BHP chief executive Andrew Mackenzie since publicly releasing a roadmap of changes it wants at the company, most notably an exit from US oil and shale businesses.

On Wednesday Elliott called for a board shake-up, blaming long-tenured directors for bad investments and ill-timed share buybacks.

That could place Mr MacKenzie, who joined BHP's board just last year, in good standing with Mr Elliott. Regarded as highly focused on capital discipline, he replaced 75 per cent of Amcor's top 80 managers in his first two years at the company.

Elliott had no immediate coment on Mr MacKenzie's appointment. Portfolio managers at another activist shareholder, Tribeca Investment Partners, were not immediately available to comment.

Mr Nasser has defended the company's US$20 billion investment in shale acquisitions in 2011 against Elliott's criticism.

BHP also faces a key juncture in the Samarco mine dam liability saga in Brazil, which is due to be settled in September.

A burst dam at Samarco, a joint venture between BHP and Brazil's Vale, killed 19 people and caused the country's worst ever environmental disaster in late 2015, when mud and waste destroyed a village and polluted the Rio Doce river.

Despite being the world's biggest mining house, BHP has a history of appointing executives from outside the sector as chairs. Since 1984 only two out of six chairmen had mining backgrounds.

REUTERS

Nespresso
Pair your daily business read with the perfect cup of espresso.

Subscribe to The Business Times today to receive your very own Nespresso Inissia coffee machine worth $188.

Find out more at btsub.sg/btdeal

Powered by GET.comGetCom