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Marius Kloppers, CEO of mining giant BHP Billiton.

Fred Lum/Fred Lum/The Globe and Mail

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.

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"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.

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"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.

In the interim, commodity markets have continued to shift, with major producers shelving projects and redrafting strategies as they eye more stormy weather ahead.

Some companies have gone so far as to shuffle boards, and chief executives at some of the world's largest miners have either been oustered or left by their own accord in recent months.

Most recently Anglo American PLC's chief executive Cynthia Carroll left the helm of one of the world's largest miners nearly seven years into the gruelling role.

Toronto-based gold miners Barrick Gold Corp., the world's largest producer of the metal, and Kinross Gold Corp. have both fired their chief executives over the past five months, promising at the same time to embark on radical rethinking of corporate strategies.

Jac Nasser, BHP's chairman, has been supportive of Mr. Kloppers, praising him and his team for their work as markets swooned for the commodities it relies most on, like iron ore and coking coal.

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"We are very fortunate to have Marius as the CEO of the company, and he has been there for five years, and they've been five very, very successful years for us," Mr Nasser said in September, a month after the company reported its first annual profit loss in three years.

"More importantly than that, if I look at the top team of BHP Billiton, and with respect to all of the other natural resource companies around the world, I wouldn't swap that team for any other team, and that says something."

Mr. Kloppers is already getting a bit long in the tooth for CEOs at BHP. He completed his fifth year as CEO in October, having taken over from Charles Goodyear in late 2007, who lasted nearly five years, BMO's Mr. Robson pointed out in his report.

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About the Author
Mining Reporter

Pav Jordan is a mining reporter for the Report on Business. More


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