Rio's next chairman quits after board row

Rio Tinto was left hunting for a new chairman today after the man it had lined up for the job suddenly quit the board following a bust-up with fellow directors.

Jim Leng was due to succeed Paul Skinner as chairman in April but quit after vigorously opposing the debt-laden company's plan to sell a stake to Chinese aluminium giant Chinalco to cut its £26.3 billion debt.

"There comes a point when you have to take a decision on principle," he said this evening.

Leng, who was named as Rio's next chairman just over three weeks ago, said: "As the company previously stated, it has a financial issue to resolve in terms of its debt and repayment, and there has been a difference of opinion over which option the company should pursue.

"I am hopeful that my resignation will enable the board to reach a consensual decision."

But sources close to Rio insisted the disagreement was about personality rather than strategy, and that the non-executive directors had already taken the view that his appointment had been a mistake.

Leng, however, said he took the decision to quit entirely of his own volition, and he was leaving entirely because of the strategic disagreement.

Senior independent director Andrew Gould said: "The board was unanimous in accepting Jim Leng's resignation."

Skinner will stay until mid-2009, while a successor is found.