By Colin Kruger
Gina Rinehart's battle with her children over the management of a multibillion-dollar family trust is holding up dividend payments that will be worth $2 billion by the end of this year, according to Mrs Rinehart's flagship company Hancock Prospecting.
Following the release of the mining group's financial accounts for the year ending June 30, 2019 (which revealed a 90 per cent increase in net profit to $2.62 billion), the company said $1.85 billion of dividends had yet to be paid to Mrs Rinehart's children as of September 30.
Dividends worth $1.85 billion have been withheld from Hope Margaret Hancock Trust beneficiaries such as Bianca Rinehart. Credit: Ben Rushton
This is due to a family dispute over The Hope Margaret Hancock Trust.
The company said this provision for dividends would be closer to $2 billion by the end of the year as earnings ramp up at the company's mines, which includes the Hope Downs project.
"Due to disputes arising under the deed, the dividends have not yet been able to be paid and cannot be paid until those disputes are resolved," said Hancock Prospecting in a statement.
"Various arbitration proceedings have been commenced as mandated by the deed in order to determine the issue."
The dividends have not yet been able to be paid, and cannot be paid until those disputes are resolved.
Hancock Prospecting
In May Mrs Rinehart's battle with her eldest children, John and Bianca Rinehart, went behind closed doors after the High Court agreed the dispute should not play out in the public spotlight.
The siblings are challenging a series of deeds signed between 2003 and 2010 that allegedly deprived them of billions of dollars in mining profits and boosted their mother's shareholding at their expense.
The trust owns 24 per cent of Hancock Prospecting. Mrs Rinehart owns the remainder of the company, which helped raise her net worth to $US17.9 billion ($25.9 billion), according to Bloomberg – an increase of $US3.7 billion ($5.34 billion) this year.
For the current financial year, Hancock Prospecting provided for $483 million of dividends, down from $528 million the previous year.
Most of these dividends will flow to Mrs Rinehart.
Gina Rinehart, pictured at last year's Derby Day, is now worth $US17.9 billion, according to Bloomberg.Credit: Luis Enrique Ascui
The company highlighted the fact it is "among the ranks of Australia's largest corporate taxpayers", with federal and state taxes exceeding $1 billion for the first time this year, at $1.14 billion.
"Mrs Rinehart, as executive chairman of the Hancock Prospecting group, continues to primarily direct investment into Australia and pays substantial taxation in Australia, while providing employment and opportunities for many thousands of Australians, directly and indirectly," the company said.
The company accounts showed it has not lost confidence in its $US250 million investment in the Australian-run potash miner Sirius Minerals.
Sirius planned to build a multibillion-dollar potash mine deep beneath the UK's North York Moors National Park, but it is on the brink of collapse after failing to raise the money needed to fund its development in September.
"This mining project, which is still to be fully constructed, is currently conducting a review of development and funding options," said Hancock Prospecting.
Sirius was due to announce the review findings last week.