U.S.-based activist investor Elliott Associates has stepped up pressure on BHP Billiton (BHP.AU), demanding the new chairperson take a broom to the board of directors and add new blood to the world’s largest miner.
The BHP Billiton board will meet later this week to vote on a new chairperson, with director – and former CEO of Australian packaging group Amcor (AMC.AU) – Ken MacKenzie expected to be appointed the new chairman.
Elliott says the change at the top is the perfect opportunity to shakeup the board:
Photographer: Patrick Hamilton/Bloomberg
The impending selection of a new chairperson is an opportunity for BHP to heed the calls of its shareholders and conduct a thorough and independent re-examination of its business and its governance.
Elliott reckons its time for change given many of the directors oversaw acquisitions, such as the move into U.S shale, that have proved costly to shareholders:
BHP has an entrenched board, with long-tenured directors having approved the disastrous acquisitions and poorly timed share buybacks that are at the root of much of today’s underperformance.
A significant upgrade in directors is needed.
Elliott wants BHP Billiton to collapse its dual-listed structure, spin off its U.S. petroleum business and return more capital to shareholders. AMP Capital, one of Australia’s largest fund managers, has called for an independent review of Elliott’s proposals.
BHP Billiton shares have fallen around 14% from their highs in late January. The stock last traded at AUD23.88 a share.
June 14, 2017 at 07:47AM
from Robert Guy
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