MinRes boss bemoans hedge funds, Trump in leaked memo to 6000 workers of WA miner

Mineral Resources boss Chris Ellison reveals he’s up for the challenge as the company fights for survival.

From a leaked memo to staff obtained by The Australian.

Embattled Mineral Resources boss Chris Ellison has issued a rallying cry to his workforce, vowing to “once again prove the naysayers wrong” as the company battles with falling commodity prices, operational setbacks and a mountain of debt.

MinRes shares surged 18 per cent on Thursday, making it the second-biggest winner on the ASX in a global rally.

The leaked memo obtained by The Australian is a rare airing of Mr Ellison’s thoughts amid the company’s financial woes and his involvement in various governance scandals that have been condemned by superannuation investors and attracted a regulatory probe.

Mr Ellison thanked the 6000 MinRes employees for their hard work and dedication “as we continue building this company in some of the most difficult external circumstances”.

“We’ll once again prove the naysayers wrong and show that it’s the grit, ingenuity and resilience of the little guy that wins in the end, no matter who tries to bring us down,” he said in the Thursday note.

“I’m as committed as ever to my 32-year investment in MinRes and the significant opportunities we have ahead of us.”

The MinRes share price closed at $17.01. It was one of the hardest hit stocks on the Australian market as global recession indicators mounted, spooking commodity markets.

Mr Ellison owns an 11.5 per cent stake in MinRes and had watched his person wealth – estimated at more than $2bn in mid-2024 – shredded amid the company’s and his personal fall from grace.

“I know it’s not easy to watch the share price or read the media coverage of the business at the moment. More than anyone, I understand how you feel,” he said.

“But I have never been more confident in our amazing people and the direction you’re helping take this business.

“We can’t control the lithium price, we can’t control the attack we’ve been under from short-sellers and we certainly can’t control Donald Trump’s tariffs.

“What we can control is our dedication, how we look out for each other and continuing to operate safely and efficiently towards our goals – on site and in the office.”

Mineral Resources founder Chris Ellison.

The company is now valued at $2.82bn compared to its $5.8bn debt pile and there is renewed speculation it is trying to sell its 50 per cent stake in the Wodgina lithium mine in WA, according to The Australian’s DataRoom column.

MinRes is the fifth-most shorted stock on the ASX, with bets against the diversified mining services provider and iron ore and lithium producer representing about 13 per cent of its float.

Mr Ellison said the Onslow Iron project – so far bedevilled by problems with a private haul road linking iron ore operations to port – was going to transform the business.

“The haul road is an amazing piece of infrastructure, but like all mega-projects not everything has gone to plan from day one,” he said.

“We have some additional works to do to upgrade and future-proof the haul road – and those works are running to schedule while haulage continues.

“Every other component of the project is performing beyond expectations and that’s something we should all be immensely proud of.”

MinRes shocked investors in February by revealing it needed to spend $230m to repair and resurface the 150km-long road after heavy rain and a series of rollovers involving the fleet of jumbo road trains it uses to haul ore.

The rollover problems started soon after MinRes struck a deal to sell a 49 per cent stake in the road to Morgan Stanley Infrastructure Partners for $1.1bn, and led to WA safety authorities ordering a temporary closure last month.

Mr Ellison, who founded the business that grew into MinRes with $10,000 in 1992, told workers the company had been through hard times before and outlasted them.

“Despite all the noise, this is a robust business with amazing people at its backbone. We’ve undergone multiple global shocks and commodity cycles over the years and this will be no different,” he said.

“Our financial position is strong – solid earnings continue to underpin a strong liquidity position. Our debt is unsecured, long-tenor and covenant-light bonds that were designed to ensure we had the flexibility to invest in the next stage of our business’ growth.”

MinRes critics have pointed to doubts about the company’s capacity to repay those debts.

The MinRes share price soared to $92.16 in early 2023 on the back of its exposure to lithium as premiums for the battery making ingredient skyrocketed.

The prolonged downturn in lithium prices since then has hit its balance sheet hard coupled with revelations about Mr Ellison’s involvement in tax evasion and misuse of company resources. He has agreed to exit as managing director by April next year.

In February, Perth-headquartered MinRes reported a first half net loss of $807m compared to net profit after tax of $530m for the same period last year.

Mr Ellison remained upbeat about lithium and the global economy in his memo to staff.

“Lithium will come back and our focus on costs will make the upside even stronger,” he said.

“The global economy will bounce back, perhaps even better.”

MinRes remains under investigation by the Australian Securities and Investments Commission. Some investors support Mr Ellison keeping his job despite his related party dealings.

Originally published as MinRes boss bemoans hedge funds, Trump in leaked memo to 6000 workers of WA miner