In October 2016, Rio Tinto signed a non-binding agreement with China’s Chinalco to exit the Simandou project. The Company will receive a small fee on its estimated US$1.1 - $1.3 billion stake in the project should the mine ever be developed. As of the end of 2017, Rio Tinto still held 45.1% in the project (indirectly through Simfer SA). In compliance with guidance from the Financial Conduct Authority (FCA), Rio Tinto proceeded to write down the value of the resources at Simandou taking a pre-tax
impairment charges of US$1,849 million in 2015.
Background on Simandou:
The bribery saga dates back to 2008 when Rio Tinto was stripped of half the rights to the Simandou project by Guinea’s long-time dictator Lansana Conté, citing the failure of theCompany to develop the project a decade after acquiring the rights. The stripped rights were then awarded to BSG Resources (BSGR), controlled by billionaire investor Benny Steinmetz. Following the death of Mr. Conté shortly after the decision, and the ascension of Mr. Condé to the presidency, Rio Tinto paid $700 million to confirm its rights to block 3 and 4 of the Simandou project. BSGR later sold 51% of its stake in the project to Vale SA for an estimated $2.5 billion. In 2014 however, the Guinean government revoked the rights held by BSGR and Vale, claiming that there was evidence of corruption in awarding the rights in the first place
According to Mahmoud Thiam, Guinea’s former mining minister, Steven Din, the former head of Rio Tinto’s Guinea operation, offered him a bribe in early 2010 to regain control over the rights given to BSGR, a claim Mr. Din, who is now CEO of a copper mine in Zambia, denies. A diplomatic cable leaked by Wikileaks revealed that Mr. Din met with the US ambassador to Guinea in February 2010 around the time the alleged bribe took place. A memo prepared by the ambassador following the meeting indicated that he was informed by Mr. Din that Mr. Thiam’s purchase of a $3 million property in New York was evidence that he was bribed by BSGR. In 2013, Frederic Cilins, an agent for Mr. Steinmetz was arrested by the FBI in Florida for potential illegal payments made in Guinea pertaining to mining concessions; he pleaded guilty and was sentenced to two years in prison. Key to the FBI’s case was a sworn testimony by Mamadie Touré, fourth wife of the late Mr. Conté, in which she revealed that she personally accepted payments in cash and shares to favor BSGR’s mining interests. Mr. Steinmetz himself was detained in December 2016 and placed under house arrest by Israeli police in connection with the case. He was detained again in August 2017 after appearing in court on charges of fraud, forgery, and money laundering
In 2015, Rio Tinto brought a racketeering case against BSGR claiming that it had paid Mr. Thiam $200 million to secure rights to Simandou. The case was later thrown out by a New York judge citing that Rio Tinto had waited too long to sue and that it had failed to demonstrate a pattern consistent with racketeering activity. Mr. Thiam was then arrested in December 2016 and convicted by a US court in August 2017 on charges to launder US $8.5 million in bribes from the China International Fund Ltd and sentenced to seven years in prison.
Rio Tinto is engaged in finding, mining and processing mineral resources. Co. has four product groups: iron ore, which supplies the global seaborne iron ore trade; aluminium, which includes bauxite mines, alumina refineries, and aluminium smelters; Copper and Diamonds, which has managed operations in Australia, Canada, Mongolia and the U.S., and non-managed operations in Chile and Indonesia, with by-product including gold, silver, molybdenum and others such as sulphuric acid, rhenium, and lead carbonate; and Energy and Minerals, which comprises mining, refining and marketing operations across borates, coal, iron ore concentrate and pellets, salt, titanium dioxide and uranium sectors.
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The general evaluation of RIO TINTO PLC. (GB), a company active in the General Mining industry, has been upgraded by the independent financial analyst theScreener with the addition of a star. Its fundamental valuation now shows 4 out of 4 possible stars while its market behaviour can be considered as moderately risky. theScreener believes that the additional star(s) merits the upgrade of its general evaluation to Slightly Positive. As of the analysis date May 17, 2019, the closing price was GBp 4,673.00 and its potential was estimated at GBp 5,020.02.
Le renouvellement des mandats de Philippe Maubert, Christophe Maubert, Catherine Canovas, et Lionel Picolet sont soumis à l’approbation des actionnaires. Au regard du manque d’indépendance au conseil d’administration, Proxinvest s’opposera aux résolutions 5 à 8. La politique de rémunération pour 2019 présentée par la société dans le Rapport de Gouvernance d’entreprise est très insuffisante. L’absence de nombreuses informations ne permet pas à l’actionnaire d’estimer la rémunération attribuable aux dirigeants pour 2019. Ainsi, Proxinvest s’opposera à la résolution 9. Concernant la rémunératio...
GouvernanceLa société propose le renouvellement de 3 administrateurs et la nomination de 2 administrateurs indépendants. Parmi les renouvellements proposés figure celui de Julie Guerrand. Selon la politique de vote de Proxinvest, en cas de conseil ne comprenant pas une majorité de membres indépendants, Proxinvest soutient 1 représentant pour chacun des 3 principaux actionnaires. En l'occurrence, le représentant le plus légitime de H51, le premier actionnaire, est sa Présidente, Julie Guerrand. Nous soutenons donc son renouvellement, mais pas celui de M. Bauer. Concernant Mme Sénéquier, bien qu...
Le conseil n'est pas majoritairement composé de membres libres de conflits d'intérêts. Par conséquent, parmi les renouvellements proposés, seul le Président du conseil sera soutenu en raison de la séparation des fonctions avec la Direction Générale (résolutions 5 à 7). En ce qui concerne la rémunération 2018 du Directeur Général, l'absence de communication des taux de réalisation de chacun des critères financiers du bonus constitue un manque rédhibitoire pour Proxinvest. Par ailleurs, l'attribution d'actions gratuites est basée sur des critères non vérifiables et qui sont calculés sur une pér...
ITEM 10: Although the board does not comprise a majority of independent members, Julie Guerrand is the most legitimate representative of the main shareholder as she is its Chairman. Thus, we recommend approval. ITEMS 7 and 8: Axel Dumas’ additional remuneration is indexed to the Group’s revenue, but only in an upward direction. If the company underperforms, executive will not be impacted. This is not acceptable. Moreover, Emile Hermès SARL’s total remuneration reached €9.6 M in 2018, which widely exceeds the median CAC 40 executives and represents 458 times the French minimum wage (SMIC), wh...
The majority of the Board is not composed of independent members. Consequently, among the proposed renewals, only the Chairman of the Board will be supported due to the separation of functions with the Executive Management (resolutions 5 to 7). With regard to the 2018 remuneration of the CEO, the failure to communicate the achievement rates of each of the financial criteria related to the bonus constitutes a fundamental flaw for ECGS. In addition, the allocation of performance shares is based on criteria that cannot be verified and are calculated over a period of only two years, which is insu...
The Annual General Meeting will be held foreseeable on the second call on May 31st, 2019, at 12 p.m. The re-election of the Chairman is proposed in item 10. Mr. Antonio Brufau Niub has served on the Board since 1996 and has been Chairman for fifteen years. Prior to serving as Chairman, he served as CEO of the Company and Executive Chairman. There are concerns that his fixed fees of EUR 2.5 million per year imply that he continues to perform some executive functions. Furthermore, ECGS guidelines do not support the appointment of a former CEO as Chairman. This can undermine the Boardns supe...
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