In an , mining giant Rio Tinto (ASX, LON, NYSE:RIO), the world鈥檚 second largest miner, said Thursday its chief executive, Sam Walsh, would retire on July 1 and that Jean-S茅bastien Jacques, the copper and coal division boss, would take the reins of the company.
Walsh, who has led the Anglo-Australian group since 2013 and overseen a cost-cutting drive as the mining sector faces plunging commodity prices, will leave Rio鈥檚 board at the same time, .
In 2014, Walsh famously said that his 鈥渁mazing鈥� Rio turnaround would be 鈥渁 Harvard case study鈥� one day.
The change of leadership comes after Rio 鈥� which is heavily reliant on iron ore 鈥� because of tumbling commodity prices that have squeezed both small and big players in the sector.
Investors welcomed the news, sending shares up 4.7% in London at around 1:00 pm GMT and 3.7% in New York pre-market trading.
鈥淭oday鈥檚 announcement is the culmination of a comprehensive and deliberate executive succession process,鈥� Rio鈥檚 chairman, Jan du Plessis, said after the market closed in Sydney. 鈥淭he board has decided that J-S is the right person to lead Rio Tinto in an increasingly complex world filled with both challenges and opportunities for our industry.鈥�
Walsh, who has been with the company for 25 years, famously in 2014 that his 鈥渁mazing鈥� Rio turnaround would be 鈥渁 Harvard case study鈥� one day.
Jacques led negotiations over a $4.4bn financing agreement needed for the expansion of Oyu Tolgoi copper mine in Mongolia.
So far, he doesn鈥檛 seem to be so far off, as the 66-year-old executive has been widely credited with during his three years at the helm, mainly by cutting costs and investment after several years of heavy spending on failed acquisitions.
The upcoming boss, Jean-S茅bastien Jacques, has spent more than three years on Rio Tinto鈥檚 executive committee. He was tasked with bringing greater focus to the copper and coal businesses and has been credited with improving safety while significantly reducing costs as the global mining sector faltered.
Most recently, the French-born executive took the lead role in negotiations over a $4.4 billion financing agreement necessary for an expansion of the giant Oyu Tolgoi copper mine in Mongolia.
To ensure a smooth transition, , Jacques is joining the board and becoming deputy chief executive effective immediately. Walsh will receive a payment of $1.4 million to cover the remainder of his contractual notice period of just under nine months.