Tom Albanese has ditched the top job at Rio Tinto over a £9bn write-down of its assets, saying that accountability for the financial disaster lies with him.
The write-downs include a $10bn hit to the value of the firm’s aluminium mining properties, but it is Rio Tinto Coal Mozambique (which suffered a $3bn write-down), which reportedly pushed Albanese over the edge.
Rio Tinto’s chairman, Jan du Plessis, said: ‘The Rio Tinto board fully acknowledges that a write-down of this scale in relation to the relatively recent Mozambique acquisitions is unacceptable. We are also deeply disappointed to have to take a further substantial write-down in our aluminium businesses, albeit in an industry that continues to experience significant adverse changes globally.’
Albanese himself said: ‘While I leave the business in good shape in many respects, I fully recognise that accountability for all aspects of the business rests with the CEO, I am pleased that someone of Sam’s calibre and values has been chosen to succeed me as chief executive. This is a great company and Sam will do an outstanding job.’
By ‘Sam’, Albanese refers to Sam Walsh, who currently heads up the firm’s iron ore division.
Still, it seems to have done the job with shareholders, as the price of shares went down just 3% with the news, and given that the massive percentage of the company's capitalisation that $14bn respresents, this is a relatively small drop. Shareholders will be praying that no more multi-billion dollar write-downs come with the new boss…