Jean-Sébastien Jacques will be the new boss of mining major Rio Tinto from July. The 44-year-old Frenchman will succeed the retiring CEO, Sam Walsh. Currently serving as the head of copper and coal division of the company, Jacques has aroused high expectations on his upcoming top role.
Rio Tinto has a long legacy with its operations dating back to the 19th century at the ancient copper mines of Spain’s Rio Tinto. There are mixed perspectives and expectations by analysts on what Jacques will be doing for the company.
The transition under a new CEO will be crucial for the 140-year-old London-based mining company which has initiated a $6 billion cost-cutting regime under Walsh after putting copper as its engine of growth.
Jacques will be taking over the reigns at a critical time. The headwinds of a slowing Chinese economy and plunging commodity prices will be challenging the new CEO.
However, many analysts expect “J-S” to bring a shift in strategy for growth and a new focus on the copper division. He has the leverage of having the company in a good shape with a strong dividend policy, reports The Australian Financial Review.
It is possible that Rio may look at acquisitions and take advantage of struggling companies in the sector. Rio has already tasted growth through Oyu Tolgoi U/G and Amrun Bauxite for the next decade’s growth.
According to analysts at Macquarie, the choice of J-S is line with the comments of outgoing CEO, Sam Walsh, who said copper will be the future. In elevating J-S, the “copper man”, who also steered the successful negotiation of greenfield project, O-T, the company is sending a strong message.
Deutsche Bank sees a shortcoming in J-S with his limited exposure to investors compared to other divisional chiefs. But it hailed his track record of managing Rio’s four key Tier 1 copper assets. Also, his credentials aligned well with Rio’s core strategy of cutting costs, portfolio optimisation and focus on Tier 1 assets.
Meanwhile, Bloomberg reported an interesting anecdote that probably helped 44-year-old Jacques to make a strong claim to the top job at the Rio Tinto Group.
It was his success in breaking the stalemate at a Mongolian mining deal. Interestingly, that happened with the intervention of his nine-year-old daughter.
Rio’s $6 billion copper mine expansion in Mongolia was stuck in a political limbo. Around that time, precisely in September 2014, Jacques invited prime minister-elect Chimediin Saikhanbileg to his London home for dinner.
Jacques’s daughter sought the autograph of the Mongolian leader. That gesture broke the ice and a financing accord was pushed to open the mine.
“My cheeky little monkey,” Jacques recalled in a recent interview, referring to the encounter.