Molycorp boss quits as company faces investigation

Molycorp CEO Mark Smith has resigned, a month after the company revealed it was under investigation from the United States Securities and Exchange Commission.

In a statement Molycorp said Smith’s departure was “absolutely not” linked to the SEC probe, and the company was at a natural turning point as it moved into production.

But Dahlman Rose analyst Adam Graf said Smith’s resignation was linked to the company’s poor performance and weakening market position, Reuters reports.

"Mr Smith's departure is tied to Molycorp's recent weaker-than-expected performance, driven in part by falling rare earth oxide price, but also by disappointing operating results, unexpected additional capital expenditures and aggressive acquisitions," he said in an investor note.

Molycorp vice chairman Constantine Karayannopoulos has been appointed interim president and CEO as the company searches for a new leader.

The search will put Molycorp alongside BHP Billiton, Anglo American, Barrick Gold, and Newmont Mining, who are also looking to shake up their executive teams.

Molycorp and Lynas Corporation are the biggest companies outside China that aim to produce a new supply of rare earths to market.

Both companies are ramping up production, and analysts have voiced concern about what the new supply will do to the rare earths price, which has fallen sharply since 2011.

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