02.08.12 9:45 AM ET
Gina Rinehart, One of World’s Richest Women, Embroiled in a Family Feud
From the country that gave us Rupert Murdoch, another media melodrama is unfolding. The main plot is a financial assault by Australia’s richest person, mining magnate Gina Rinehart, on one of the country’s largest media companies.
Rinehart, 57, notoriously private and hardheaded, is seeking close to 15 percent of the shares of Fairfax Media, and few observers think she is motivated by anything other than a platform for her conservative political views, à la Murdoch.
It will cost her in the range of roughly US$175 million. She can afford it. In the last two years her wealth, primarily from coal and iron ore, has quadrupled, putting her within range of being the richest woman in the world.
But more captivating (or perhaps titillating) than her audacious raid on Fairfax—which publishes the country’s largest-circulation broadsheet, the Sydney Morning Herald, and its leading business newspaper, The Australian Financial Review—is Rinehart’s acrimonious feud with three of her children. They have gone to court to remove her as trustee of a multibillion-dollar family trust set up by her father, their grandfather, for their benefit. (Rinehart’s youngest child, Ginia, is siding with her.)
On Monday local newspapers grabbed readers with front-page stories that Rinehart has threatened to stop paying ransom insurance for her children and grandchildren unless they agree to join her in a request to the court to seal details of the feud, including family emails.
In one of the emails, which became public last week, her 26-year-old daughter, Hope Rinehart Welker, complained to her mother that she did not have enough money for a housekeeper and cook as well as a bodyguard. “Even my friends who have nothing compared to your wealth have more staff,” wrote Welker, who lives in New York. “I don’t think you understand what it means that the whole world thinks you are going to be wealthier than Bill Gates—it means we all need bodyguards and very safe homes!!”
At the weekend, her only son, John Hancock, 36, went public, upbraiding his mother for failing to provide security for her family.
“When my mother buys a few hundred million dollars worth of Fairfax, it’s going to draw some attention,” he said in a statement released to the media. “But she won’t share a penny to help protect her grandchildren ... What more can I do than communicate to any kidnappers out there—over my dead body and you will be wasting your time anyway. If you think you’re going to get anything from my mother, good luck.”
Rinehart, who was for many years married to an American corporate lawyer some 30 years her senior, inherited Hancock Prospecting when her father, Lang Hancock, died in 1992. Rinehart filed a lawsuit against her father’s Filipina maid-turned wife-turned-widow over control of the estate, alleging that she had contributed to her husband’s death. Ever determined, if not pugnacious, Rinehart continued the court battle for 14 years, eventually losing when a coroner ruled that Hancock had died of natural causes.
Rinehart may have inherited wealth, but even her critics acknowledge her business prowess. “In what is still largely a man’s world of mining, she is one super tough, uncompromising woman,” Jennifer Hewett wrote in a lengthy, generally favorable profile of Rinehart in The Weekend Australian (which is part of Murdoch’s News Limited empire).
Rinehart's wealth, estimated at $5 billion (Australian) in 2010, has, through the sale of coal and iron-ore properties, ballooned to nearly $20 billion. (The Australian dollar is worth roughly US$1.06.) One of her iron-ore interests earns $20 (Australian) a second—“every second of every hour, of every day, of every year,” Pamela Williams noted in a profile of Rinehart in The Australian Financial Review.
Not surprisingly, Rinehart is vociferously opposed to the country’s mineral-resource tax, which the Labor-led government enacted last year. It is designed to give all Australian residents a greater share of the profits that mining companies make from the country’s vast mineral deposits, which are increasing almost exponentially thanks to China’s insatiable demand. Mining companies argue that the tax will crimp investment in a vital sector of the economy.
Rinehart is also a skeptic about climate change, and is opposed to the country’s tax on carbon emissions, also enacted by the Labor government.
Those who expect Rinehart to use her Fairfax investment for political ends point to Channel Ten, where she purchased 10 percent of Ten Network in 2010, during the heat of the debate about the carbon tax. In this country where media ownership has been marked by family dynasties, Lachlan Murdoch is the chairman of Ten. After Rinehart acquired a seat on the board, a conservative commentator was given a Sunday talk show.
What will Rinehart do with Fairfax? “Wait for the next thrilling installment,” wrote the journalist Jennifer Hewett.