Dec. 5 - Richard Adkerson, CEO of Freeport-McMoRan Copper and Gold, is leading a major expansion into the energy sector with a $9 billion takeover of Plains Exploration & Production and McMorRan Exploration. Conway G. Gittens reports.
Our Power Player today is Richard Adkerson, he's president and chief executive officer of mining company Freeport-McMoRan Copper & Gold. Adkerson just struck a deal to buy two energy companies Plains Exploration & Production and McMoRan Exploration for $9 billion in cash and stock. For Freeport, the deal means a major expansion into the energy sector. It will also help diversify geographically; most of the company's mines are outside the United States, while Plains and McMoRan have energy plays in California, Texas and the Gulf of Mexico. The new combined company will generate almost three-quarters of its 2013 operating earnings from mining and the rest from oil and gas. But Adkerson is taking on debt to do the deal and investors are taking a knife to the stock, shares falling sharply as total debt on the balance sheet jumps to $20 billion. Adkerson takes on the role of president, CEO, and vice chairman when the deals close.