Australia’s richest man Andrew Forrest loses $184 million as mining tax spooks investors

The sharemarket has delivered a brutal assessment of who it thinks were the winners and losers from the Henry Tax Review – and mining entrepreneurs are in the gun.

A staggering $12 billion was wiped off the value of Australian mining shares, led down by BHP Billiton shares (down 3%), Rio Tinto (down 4.3%) and Santos (down 4.6%).

Iron ore miner Fortescue Metals Group was also one of the hardest hit, after a report from investment bank UBS suggested its earnings could fall by as much as 36% in the 2013 financial year.

Fortescue shares fell 4.2% yesterday. That wiped over $184 million from the value of the stake held by company founder and executive chairman, Andrew Forrest, who had warned before Sunday’s tax announcement that the imposition of a tax on resource industry super taxes was short-sighted.

“What you shouldn’t do is kill the golden goose that emerges at the time, or you will find you have no more geese,” he said last week.

But Forrest wasn’t the only mining executive to take a hit.

As shares in Whitehaven Coal plunged 7%, directors Hans Mende and Tony Haggerty saw the value of their stakes fall by $28 million and $11 million respectively.

Shares in Linc Energy fell 5.5% yesterday, wiping $16 million off the value of managing director Peter Bond’s stake, which is now worth around $310 million.

But the pain for many of these executive is not just financial.

Tony Haggerty joined mining executives from around the country yesterday to bemoan the impact that the new tax would have on local companies and Australia’s reputation as a place to do business.

“A mid-sized coal company listed on the stock exchange relies totally on the confidence of investors to raise capital and in one fell swoop, the Federal Government has turned us from have a reputation for being a very stable place to do business to one where anything can happen at any time,” he told the Australian Financial Review.

“You only need to have a few projects delayed or cancelled and it wipes out any gains that could be made from any additional tax.”

The Federal Opposition has also signalled it is not happy with the resources super tax proposal and will consider blocking the legislation when it comes before Parliament, although this is unlikely to happen before the Federal election.


Notify of
Inline Feedbacks
View all comments
SmartCompany Plus

Sign in

To connect a sign in method the email must match the one on your SmartCompany Plus account.
Or use your email
Forgot your password?

Want some assistance?

Contact us on: or call the hotline: +61 (03) 8623 9900.