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Tony Trahar was a bit embattled - Patrice Rassou, SIM
In an interview on ClassicFM @ Wednesday, 26 April 2006
[miningmx.com] -- TONY Trahar was embattled owing to the slowness of change at Anglo American, said Patrice Rassou, a portfolio manager at Sanlam Investment Management.
These comments follow an announcement by Trahar, CEO of Anglo American, that he would retire next year following completion of a restructuring of the group. In terms of the restructuring, non-mining assets would be disposed which would increase its exposure to the commodity price run and improve the structure of Anglo American.
"I would think that Tony Trahar was a bit embattled for the past year or so - the market as isn’t patient, and wants results fairly quickly," Rassou said.
Rassou said Anglo American's structure had been unwieldy owing to the existence of listed subsidiary companies such as Anglo Platinum and AngloGold Ashanti that provided alternative investment entries to the group.
"The way I
look at it - given the pressure, given what shareholders expect - I think pressure came to bear, and Tony Trahar saw it fit to announce his retirement," Rassou said. He was speaking on Classic Business.
Commenting on the commodity cycle, Rassou said additional speculative money had entered the market intensifying the upward pressure on prices provided by falling metal inventories.
"There are various categories now of speculators," Rassou said including exchange traded funds which in gold alone accounted for $8bn in investment.
In addition, some $70bn had been injected through commodity index funds while newly launched commodity unit trusts added another $30bn.
"So $100bn has appeared in the past few years, and these funds are chasing really a very thinly traded market," Rassou said.
"Hopefully it’s not going to end in tears," he said.
For the year to date, copper for delivery in three months costs 60% more, zinc is almost 80% up, nickel
is up 50%, said Rassou.
"Gold is up well over between 20% and 23%, platinum is up almost 20%, palladium up 45% - it’s pretty amazing," he said.
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