Sydney (dpa) – The Chinese have a saying: the first generation creates wealth, the second looks after it and the third loses it. Gina Rinehart, only child of legendary iron ore prospector Lang Hancock, worries about that third-generation curse afflicting Hancock Prospecting Pty Ltd (HPPL), the mining business she has run for the past 20 years. Her three oldest children have taken action in the New South Wales Supreme Court to oust their mother as head of the trust fund that owns 23 percent of HPPL.In court papers, they claim “serious misconduct” in the management of the trust. Rinehart, Australia’s richest person, denies the charges leveled at her by Hope, Bianca and John. In her defense, she claims none of the trio has the “requisite capacity or skill, nor the knowledge, experience, judgment or responsible work ethic to administer a trust,” in particular one that is part of the growing HPPL group. She described them as being “manifestly unsuitable” for trusteeship. She is backed by 25-year-old Ginia, her youngest child, who has taken her side in the court battle over the trust fund, which holds around a quarter of a family fortune estimated at 17 billion Australian dollars (18 billion US dollars). Gina Rinehart is no stranger to litigation. For 14 years she kept her stepmother, Philippines-born former housekeeper Rose Porteous, in the courts over the circumstances of her father’s death 20 years go. HPPL has come a long way since she took control in 1992, when the company was long on promise but short on solid achievement. Deals with Rio Tinto Ltd and other big companies have seen her parlay mineral rights into a massive income stream. A formerly debt-laden company is now a money-spinner with an estimated 200 million Australian dollars coming in from Rio Tinto each year. But newcomers to the industry have been rising up without the benefit of a mentor and a mineral deposit to get them started. It took Andrew Forrest less than 10 years to make Fortescue Minerals Group the nation’s third-biggest iron ore miner after BHP Billiton Ltd and Rio Tinto. Rather than just holding the mineral rights and signing up others to do the actual digging, Forrest developed the project from scratch and runs the whole show himself. Rinehart appears to be following his example, and is busy raising the 7 billion Australian dollars needed to get such an iron ore project up and running at Roy Hill in Western Australia. South Korea’s Posco, the world’s third-largest steelmaker, is expected to pay 1.5 billion Australian dollars this month to raise its stake in the project from 3.75 percent to 15 percent. HPPL is hoping to retain around 70 percent of a company producing 55 million tons of iron ore a year. But the global slowdown has eased export prices and added uncertainty to massive projects like Roy Hill. And the family trust at the heart of the current court battle owns the major stake in the projected mine. The court case has moved reclusive Rinehart from the business pages to the front pages. With the initial block on reporting removed, the family squabble is out in the open. Private correspondence is now in the public domain and the tabloids are going to town over the notion of bratty kids being kept away from a thriving family business. Source: Bikya Masr
