Investors BHP spin-off’s mining cred

Mr Lawcock expects BHP to put in place a rolling capital management program, most likely in the form of a buyback based on prospective earnings. "We forecast BHP to generate $US8 billion in free cash flow over the next two years, which could be used to fund a $US5 billion-plus buyback, starting with an on-market buyback in London, followed by an off-market in Australia when balance sheet position allows," he said.

Mr Schroeders, a Melbourne-based fund manager with a holding in BHP, said Mr Crawford was "well regarded and credentialled as a company director". "It is not a condemnation of either of the individuals involved, it is more a case of observing balance with senior management and board structure," he said. "But if the board has a good smattering of well-experienced mining people, that might be mitigated.

UBS analyst Glyn Lawcock said a company needed to be assessed on its full management structure. "One would need to consider the people that the CEO surrounds himself with, potentially good operating people at the unit level and a chief operating officer. "You need a balance, and it is important to look at the management team in its entirety.

Read more here: SMH


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