[miningmx.com] – FOR a man with such an ingenuous style, it’s always interesting to see how evasive Randgold Resources CEO, Mark Bristow, becomes when asked why his company has never rested in the sights of a predator.
Asked again this week at the gold firm’s annual lunch with mining journalists in Johannesburg, Bristow was brief: “Because people are afraid of the areas in which we operate,” he said.
It’s true, Randgold makes a mockery of the geo-political risk discount applied to many African mining companies. In its time, the company has sat through a coup d’etat in both Mali where it operats and in nearby Sierra Leone, and most recently ploughed $1.8bn in Democratic Republic of Congo (DRC), a shakily emerging democracy.
“The biggest single risk for investors is management, not geography,” said Bristow. “We are the best example of that,” he said.
Yet one of the other reasons why Randgold hasn’t been approached by another major mining company is Bristow himself. The company’s succession plans are extensive, but whoever follows Bristow will do so knowing its style and culture is indelibly formed by the personality of its founder.
Bristow established Randgold Resources in 1996; he was it’s CEO when it almost went bust during the last gold price correction, and he must now rank as the longest serving leader of a major gold company anywhere.
He said this week that he’d like to see out delivery of one more major gold mining project before retiring from the firm. That is tantamount to saying he intends to leave at near retirement age.
At 55 years, Bristow would be around 60 assuming the next major gold mine he craves will rival Kibali, the DRC mine Randgold recently commissioned in joint venture with AngloGold Ashanti, but that took more than five years to develop.
In any event, any takeover of Randgold would be a hostile one: Bristow would never countenance another executive sitting on his nest. His solicitousness is there for everyone to see. Explaining why the executive succession conundrum is never solved by ‘an appointment’, Bristow said: “You just don’t want any nob coming in”.
South Africa
South Africa ought to be worried. Whatever you may think of Bristow, he has a track-record for sound judgement. The country of his birth, however, concerns him for its arbitrary knack of “changing the rules”.
Said Bristow of the investment landscape in South Africa: “There is a lot of resistance. You don’t need BEE to develop skills, you need a mindset, but in South Africa they [the government] don’t realise the importance of developing a national asset”.
Bristow is a non-executive director of Rockwell Diamonds, a Johannesburg listed company operating to great effect in the Middle Orange River, where it digs for allluvial diamonds. His brother, John, ran Rockwell Diamonds for a time.
“It’s still considered normal that the mining industry has to get beaten up [in South Africa].
“We [Randgold] invested $1.8bn in the Congo without having to pay a bribe whereas in South Africa the people just keep making up new rules,” he said.
Randgold has received offers to list on the Johannesburg Stock Exchange – all of them turned down. “We see ourselves as a sub-Saharan company and we don’t need the capital, but the capital base is also difficult in South Africa owing to exchange controls.
“The problem in South Africa is the example it sets. It should be a leader of the African emergence but it is always decrying the opportunities it has lost,” he said.
