The India-focused resources group said yesterday that Albanese has been hired as chairman of Vedanta Resources Holdings, a subsidiary of the FTSE 100 company.
In his new role, which takes immediate effect, he will advise the main group’s board and the company’s operations.
“Tom will be actively involved in continuing to develop the company’s strategy, policies and growth objectives,” said Vedanta in the statement.
Like many mining companies, FTSE 100-listed Rio Tinto overhauled its senior management after the cycle turned, with figures like Albanese taking the blame for misjudged acquisitions during the boom that resulted in huge debt burdens.
Albanese left in January after the firm revealed a $14bn writedown, which was almost entirely due to two of his most significant acquisitions, aluminium company Alcan and Mozambican coal company Riversdale.
It is thought that Albanese’s appointment will add a global face to Vedanta, which is still often seen as an Indian organisation despite being an international player. He will be primarily based in London but will spend a lot of time on the ground at the company’s Indian operations.
Vedanta, which is still 65 per cent controlled by founder and chairman Anil Agarwal, recently underwent an 18-month restructuring to simplify the group’s structure and enable it to cut down its debt better. This, along with Albanese’s appointment, has suggested that the company is looking to build its empire outside of India.
“I am excited to welcome Tom to our team and I look forward to him bringing his considerable experience and energy to Vedanta to support our twin aims of delivering sustainable growth and creating long-term value for our shareholders,” said Agarwal.
“I have recently visited many of Vedanta's operations and met many of its employees,” said Albanese. “I am impressed with Vedanta’s world class businesses and its board’s vision.”
Rio Tinto’s shares closed up 1.26 per cent at 3,182.5p yesterday.
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“Tom Albanese is the biggest destroyer of value in recent times,” an analyst who understandably chose not to be named told City A.M. in response to the ex-Rio Tinto chief’s new appointment at fellow miner Vedanta Resources.
The analyst was of course referring to Albanese’s infamous acquisition of Alcan, which was bought for $38bn (£23.9bn) in 2007, slap bang in the middle of the commodities boom and at the same time as a hostile takeover offer from rival BHP Billiton, which Rio said undervalued its prospects. Less than a year later the financial crisis hit and Chinese demand tailed off, forcing Rio to divest assets in a distressed market.
Poor Albanese. Bouncing back from the Alcan embarrassment, he later went on to buy Mozambican coal company Riversdale – his second major deal to result in major writedowns for Rio during his almost six-year tenure at the top.
“Albanese is a good manager on a day to day basis and he is well-liked, but the blame for Alcan falls squarely on his shoulders,” said the analyst. “He went against what other people were recommending. Hopefully he has learnt from his mistakes.”
Indeed, now is Albanese’s chance to be remembered as the industry veteran who made his mark on Vedanta, rather than the cause of Rio Tinto’s troubles.