Xstrata-pheric wealth

MOST chief executives give the impression that their climb up the greasy pole of business has been the result of a careful plan diligently executed: they got where they are because that was what they always intended.

Mick Davis, chief executive of mining group Xstrata, is different. 'I'm not one of these people who has some master plan for what they are going to do for the rest of their lives,' he says. 'Things happen, opportunities come up.'

A decade ago, he was finance director of electricity company Eskom in his native South Africa. When he was passed over for the top job, he joined mining group Billiton. Did he know anything about mining? 'No, nothing,' he says with a smile.

Yet Davis, 45, has arguably done more than any other person to bring about the renaissance of London as a world centre of mining finance. He helped to bring South Africa-based Billiton to the London stock market in 1997, raising about £800 million in the process. And he took the lead in enabling Billiton to find the £800 million to buy Rio Algom in 1999.

After Davis joined Xstrata, the company moved its listing to London from Switzerland in spring last year and raised £700 million. Xstrata persuaded shareholders to cough up a further £900 million last June for the £1.8 billion takeover of MIM Holdings. And to round things off, Xstrata this month issued convertible bonds for £375 million.

Add the money Davis raised when he was at Eskom after South Africa's rehabilitation on the world's capital markets, and the total is pretty scary. For his various employers, he has brought in nearly £10 billion.

So does this suggest that Davis is simply very charming, very adept in persuading investors to part with their money? He laughs: 'Of course, anyone who meets me will see what a charming person I am. But when it comes down to it, people appreciate honesty. When you're dealing with providers of finance, you have to build up credibility over time.'

And he is disarmingly candid when talking about the challenges of running a group with interests ranging from chrome and zinc to copper and coal. The best-laid plans can be derailed by the vagaries of the commodities and currency markets. Yes, the company can try to hedge against currency movements, but that doesn't always work. Xstrata, a £3 billion FTSE 100 company, bet on the rand falling - in fact, it has shot up. 'We were obviously wrong,' admits Davis.

He has a reputation for being intimidating and he is certainly large. But sitting in the shade of a tree in the garden of his modern north-west London home, his demeanour is placid. He is clearly self-confident, but he is calm and gently spoken.

Billiton's London listing meant Davis had to uproot his wife, Barbara, and three children and bring them to Britain. 'Barbara had a much more difficult time than I did,' he says. 'She had to deal with the sharp end of things such as schools for the children and so on, and she had to give up her legal practice.'

Then, at the time of the 2001 merger of Billiton and BHP, it was deemed that the combined group's finance director - a job for which he had been chosen - had to live in Australia. 'From a career perspective, Melbourne didn't seem to be the centre of the universe,' recalls Davis. He also didn't welcome the prospect of moving his family again.

His dissatisfaction became public and he was approached by Glencore, a Swiss-based natural resources group: would he like to become head of Xstrata where Glencore had a 38% stake? At the time, Xstrata was, in Davis's words, 'going nowhere'.

'It forced me to make a choice,' says Davis. 'It seemed I had done my job at Billiton and I was being given the chance to be the person making the running rather than merely being at the right hand of the person making the running.'

But even before Davis officially took up the position, fate intervened again. Glencore had a coal business, Enex, that it wanted to go public and executives were in New York trying to entice investors. The date was September 11, 2001. The terrorist attacks scuppered the float.

Later that month, Davis was flying from Switzerland to London with finance director Trevor Reid when he had a thought - maybe Xstrata could buy Enex.

'We did the calculations on the back of a matchbox or something,' he recalls. This would be the first big step to lift Xstrata into mining's major league - not alongside the real giants such as Anglo-American, Rio Tinto and BHP Billiton perhaps, but none the less a group with clout.

A £1.5 billion deal to buy Enex was clinched in March 2002. Three months later, Xstrata was promoted to the Footsie. A year after that came the takeover of MIM. Xstrata is now more than seven times bigger than when Davis joined.

So is the job complete? 'No,' he says, 'but in five or seven years, or whatever, I'll move on.'

He didn't plan his career to date. Why plan for the future?