Ex-BHP CFO to replace Carroll at Anglo?

* CHAIM EVEN-ZOHAR | Thursday September 6, 2012 00:00

Australia's Herald Sun summarised it in one sentence: 'The man who could borrow a billion dollars at one percent has decided to leave that job at BHP Billiton and is now officially on the market.' He left the company at the end of February 2012.Vanselow's annual compensation package from BHP Billiton at the time of his resignation totaled US$6,067,035 or (P46,000) and his job was very secure. Why would someone walk away from that after having already been with the company for almost 23 years?

When asked the same question by BHP Billiton's board and by analysts, Vanselow answered that he was looking for the next step in his career, namely, 'becoming the CEO of a publicly traded organisation somewhere in the world, probably with a business that has similar dynamics, which is capital intensive, long-term capital.' He was about to turn 50 years old - and that was the age he had set for himself to be the CEO of a company.

Replacing Cynthia Carroll?Now word is circulating in London speculating that Vanselow is slated to replace the beleaguered Cynthia Carroll at the helm of Anglo American. Carroll's departure seems a matter of style and semantics - of whether she'll be fired or will tender her resignation as CEO. We are careful to say that this is just a rumor - though a very persistent one - supported by additional anecdotal indicators.

For example, various institutional investors and managers handling mining portfolios have recently seen Vanselow when Citibank organised some kind of roadshow to take him around. What was actually said at those meetings is something hard to verify. But it is clear that one doesn't meet with such institutions for no reason. Also, rumors start for a reason; Anglo American is not commenting on the speculation.Vanselow seems to be highly appreciated in the financial markets. Analysts who personally know him well have only the highest of praise for his professionalism and his personality. He seems to be a very impressive person.

Vanselow's Diamond AngleWhat would Vanselow's appointment mean for De Beers? From a De Beers perspective, an Anglo American CEO from a mining company that also had a diamond portfolio can only be advantageous. He was involved in all major decisions about BHP Billiton's diamond division during the financial crisis years. He was CFO when the company adopted the unique marketing model that links the BHP Billiton rough diamond-pricing mechanism used in the long-term sightholder contracts to tender prices. He was also actively part of the decision to put the Ekati diamond mine on the market and for the company to withdraw from diamonds altogether.Again, it would be good for De Beers if Anglo American were to have a CEO who is quite familiar with both the challenges of diamond mining and of diamond marketing. There have been suggestions that Anglo American had been looking at a partial purchase of the Ekati mine and maybe, Vanselow as CEO of Anglo American, might suggest that the company takes another look at that opportunity. He would know Ekati from the inside out.

While writing these lines, Cynthia Carroll is still in the captain's seat and she enjoys the support of Anglo American Chairman Sir John Parker. Financial analysts have said that it is just a matter of time before the board will yield to shareholder pressures to appoint a new company CEO. There is no surplus of executives from the market that have experience and could run the world's largest mining conglomerate. Again, these are all still rumors, and we need to wait. However, sometimes in logic and arithmetic one and one makes more than two.

* Chaim Even-Zohar is the principal of the diamond intelligence briefs