TORONTO — Joseph Conway, who guided Iamgold Corp. (TSX:IMG) through a number of mergers and helped it grow into a gold producer worth $6 billion, will step down as president and chief executive of the Toronto-based miner by mid-January in a surprise decision that has left analysts puzzled.
Conway, who will leave Iamgold Jan. 15, is to be replaced on an interim basis by Iamgold director Peter Jones, a former president and chief operating officer of Inco Ltd.
Iamgold spokeswoman Tamara Brown said the move was a mutual decision by Conway and the board.
“Joe has taken the company from a gold investment company through an international operating group, and he and the board agreed that this was the right time to transition the company fully,” she said.
“The board now will be seeking a CEO with broader international operations experience.”
The decision raised eyebrows among several industry analysts, because Conway was seen as a key leader who helped Iamgold become one of the country’s more successful gold companies, one that performs better than many of its larger Canadian competitors.
“It came to me as a surprise,” said John Ing, a gold analyst and president of Maison Placements in Toronto.
“Joe Conway has been with the firm and built the firm... and was instrumental in paving the way and changing it into more of an operating company.”
Ing said he believes Conway’s experience at the head of mining royalty company Repadre Capital Corp. — which merged with Iamgold in 2003 — would have prepared him well to lead Iamgold into the future. He questioned the company’s official stance on Conway’s departure, and its search for a CEO with more international experience.
“It’s humorous from the standpoint that when Conway built up Repadre it had assets internationally,” he said.
“He’s an investment banker by background. You can do transactions anywhere in the world.”
Jones wasn’t immediately available to discuss the direction of Iamgold in the coming months or his new role at interim chief executive.
Conway said in a statement issued by the company that he was “proud to have led Iamgold through the transformation of a joint venture player to an established operating company with a number of exciting development projects with a solid financial position and management team.”
Shares of Iamgold were ahead 20 cents to $16.71 on the Toronto Stock Exchange, as the price of gold picked up on the New York Stock Exchange.
Iamgold has been rolling out new projects in some of its key areas, in West Africa, Quebec, the Guiana Shield, Brazil and the northern Andean regions of South America.
Among its major mines are the Rosebel mine in Suriname and the Doyon mine in northern Quebec, acquired when it acquired Quebec-based Cambior Inc. in 2006 under Conway’s leadership.
Conway became a director and CEO of the company in 2003, with the merger of Iamgold with Repadre, and navigated the company towards faster growth through several mergers and other deals.
In recent quarters, Iamgold has turned out higher output and lower production costs, posting record third-quarter earnings of $64.9 million, which marked a 245 per cent increase over the $18.8 million a year earlier.
The results have helped the company’s stock double in value over the past year.
“They’ve been one of the only gold companies in the Canadian gold sector that has exceeded expectations routinely for the last 18 months,” said another analyst who asked to remain anonymous due to his company’s policies.
Scotia Capital analyst Lihor Abraham said he was surprised that Conway left his role so early and prior to the completion of the Essakane in Burkina Faso, West Africa, acquired with the takeover of Orezone Resources Inc. last year.
“We expected Mr. Conway to leave the company in the next year or so, however the timing and speed of his departure is surprising to us, as we believed he would wait until Essakane had been built,” he wrote in a note.
“We believe Joe had done an excellent job building Iamgold into a well run and managed operating company and we do not foresee any drastic changes in the direction of the company in his absence.”
Abraham added that he believes Jones “can guide the company well in the interim.”