BP still seeking chairman to replace Sutherland
BP Plc is still seeking a chairman to replace Peter Sutherland, as Rio Tinto Group Chairman Paul Skinner, cited by The Times as a leading candidate, is embroiled in a shareholder dispute at the mining company.
Sutherland, who had been due to step down after BP's annual meeting on April 16, "is expected to stay on as chairman until later in the year to allow the process to be completed," company spokesman David Nicholas said today in a telephone interview. BP has never said whether Skinner is a candidate.
Europe's second-biggest oil company reported its first quarterly loss in seven years on Feb. 3 as the global recession spurred a record plunge in crude prices. BP, whose output rose for the first time in three years, is adding production and refining capacity to boost earnings, which have lagged behind competitors such as Exxon Mobil Corp. and Royal Dutch Shell Plc.
"The process to select a successor to Peter Sutherland continues," Nicholas said, declining to comment further.
Rio's London-based spokesman Nick Cobban declined to comment on the matter when contacted today by telephone.
Sutherland, chairman of London-based BP since May 1997, is also chairman of Goldman Sachs International and was responsible for global trade talks between 1993 and 1995 as director-general of the General Agreement on Tariffs and Trade and subsequently the World Trade Organization.
EU, Ireland Posts
The 62-year-old represented Ireland as European Union Competition Commissioner from 1985 to 1989, was chairman of Allied Irish Banks Plc from 1989 to 1993 and served as Ireland's attorney general from 1981 to 1984.
Skinner, 64, is facing a shareholder revolt at Rio Tinto after unveiling Aluminum Corp. of China's $19.5 billion investment on Feb. 12. The Times said today that Skinner, a former Shell executive, had withdrawn his candidacy for the BP post over the weekend.
Chinalco, as the Chinese state-owned company is known, will buy $7.2 billion of convertible bonds and acquire stakes in Rio projects for $12.3 billion in Australia, the U.S. and Chile. It will raise its interest in Rio to 18 percent should it convert the debt.
The transaction, the biggest foreign acquisition in China's history, will enable London-based Rio Tinto to reduce the company's debt, which rose 19-fold after its acquisition of Alcan Inc. in 2007. Skinner said Feb. 12 Rio probably couldn't have raised $20 billion in a rights offer and that investors would find the Chinalco deal "compelling."
Rio Tinto's investors are "deeply concerned," Peter Montagnon, director of investment affairs at the London-based Association of British Insurers, which represents 400 insurers and institutional investors, said in an e-mailed statement Feb. 13. "This deal ignores the pre-emption principle and seems to favor the Chinese shareholder."