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Rio Tinto CEO Sam Walsh to retire, copper and coal head Jacques to replace him

Rio Tinto said chief executive Sam Walsh would retire July 1, and would be succeeded by the global miner's copper and coal division head Jean-Sebastien Jacques.

The changeover comes as the miner faces the worst downturn to hit the sector in nearly two decades.

The world No.2 miner bowed to pressure from investors and credit rating agencies earlier this year and scrapped its payout policy, under which it promised never to cut its dividend from year to year, to better reflect commodity cycles.

"The board has decided that J-S is the right person to lead Rio Tinto in an increasingly complex world filled with both challenges and opportunities for our industry," Rio Tinto Chairman Jan du Plessis said on Thursday.

Walsh, a company veteran who joined Rio in 1991 after two decades in the auto industry, was appointed CEO in 2013 after the miner sacked its then-chief Tom Albanese over acquisitions that soured and prompted hefty writedowns.

Walsh had been expected to leave this year, but it was unclear whether he would be replaced by Chief Financial Officer Chris Lynch, long considered a successor, or one of his younger divisional heads.

Jacques has spent more than three years on Rio's executive committee. He was tasked with bringing greater focus to the copper and the coal businesses and credited with improving safety while significantly reducing costs as the global mining boom went bust.

Most recently, French-born Jacques took the lead role in negotiations over a $4.4-billion financing agreement necessary for an expansion of the giant Oyu Tolgoi copper mine in Mongolia.

Jacques will join the board and become deputy chief executive with immediate effect, the company said in a statement.

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