BT has appointed Jan du Plessis, chairman of the world's second-biggest miner Rio Tinto , to take over from Mike Rake in the same role at a testing time for Britain's biggest telecoms group. BT said du Plessis will join its board as a non-executive director on June 1, and become chairman on November 1. Rake announced last year that he would retire after serving for 10 years as chairman.
He leaves a group with a host of challenges. It cut its profit forecast in January because of a downturn in British public sector work, discovered fraud in Italy and is battling the regulator Ofcom over how it should run its national broadband unit. Analysts describe du Plessis - until last year chairman of SABMiller, which was taken over by Anheuser-Busch InBev in one of the largest corporate mergers in history - as a safe pair of hands.
At Rio since 2009, he helped lead the miner through a volatile period, as it scrambled to pay down $39 billion in debt from its take-over of Alcan, scrapped a controversial tie-up with China's Chinalco, sacked a chief executive after over-priced acquisitions and fended off a bid from Glencore. "He presided over what was one of the most turbulent times in mining history and Rio Tinto has emerged as one of the strongest and best-placed mining companies despite a number of almost existential moments," Bernstein analyst Paul Gait said.
Du Plessis said it was an important time for BT, and he looked forward to working with Chief Executive Gavin Patterson "to help BT continue to support Britain's digital future". The group has been transformed in recent years by re-entering the mobile market with the acquisition of leading operator EE and setting up a TV service backed by spending billions on sport rights.
But it needs to end the damaging regulatory row with Ofcom and agree a funding plan to tackle its ballooning pension deficit, both legacies of its former life as the state telephone company. All will require injections of cash, just as the firm is balancing a cut to cash flow targets of 20 percent and a pledge to grow dividends by 10 percent this year and next.
Patterson said last week that the group's problems had been humbling, and it had been stung by the criticism from its customers and rival telecom groups. Rio said the firm began planning for a new chairman in June 2016 following the announcement that Jean-Sebastien Jacques, known as J-S, would take over as CEO from Sam Walsh who retired last year.
"When we announced the appointment of J-S as chief executive a year ago, I committed to the board to serve as chairman for another two years, as part of a planned leadership transition," du Plessis said. In a statement, Rio said it expected to announce du Plessis' successor before the end of 2017 and du Plessis would retire as chairman by no later than the 2018 annual general meeting in Australia. Analysts said they saw no major impact at Rio from de Plessis' departure as strategy is led by the CEO.
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