Gobsmacked investors demand ‘clear response’ on who signed off on Mineral Resources’ property deal in May

Gobsmacked investors have demanded Mineral Resources immediately come clean on who approved yet another transaction involving chief executive Chris Ellison that was struck just six months ago. The Australian Council of Superannuation Investors, which speaks for big superannuation funds, on Friday described revelations around a property joint venture between MinRes and Mr Ellison and other investors as “concerning” and said the company’s board has to provide “a clear response”. ACSI’s comments reflect the frustration of shareholders over previously unknown related-party deals that continue to come to light, testing MinRes’ assurances that all relationships have been disclosed. The Australian Financial Review on Friday revealed that MinRes in May paid $45 million for a 49.04 per cent stake in the Northern Gateway Master Trust, which owns an industrial park in Bullsbrook. The balance is owned by Northern Gateway Investments, a company whose owners include Mr Ellison, his wife Tia, former MinRes chairman Peter Wade and one-time MinRes director Kelvin Flynn. The Northern Gateway Master Trust is mentioned in the MinRes annual report, released in October, as a joint venture under equity accounted investments. It is valued in the report at $17m, but there is no other detail. Mr Ellison’s relationship as a co-owner of Northern Gateway Investments is not mentioned. “This is yet another concerning revelation,” ACSI chief executive Louise Davidson said. “It leaves investors asking - who signed off on the transaction? The board must provide a clear response.” MinRes said in a statement it had been “pursuing the development of strategic industrial land near transport corridors in the Bullsbrook area for a number of years to better accommodate the company’s growth”. “As part of that strategy, MinRes acquired ordinary and preference shares of Northern Gateway Master Trust (NGMT) for $45 million from Austreo Property Ventures Pty Ltd, which is an unrelated third party. NGMT has interests in strategic industrial land in Bullsbrook. “The preference shares had a fixed maturity date of February 2026 and “therefore are treated as a financial asset (loan receivable to MinRes) under AASB-9, with ordinary shares treated as an equity accounted investment under AASB-128. “MinRes discloses individual transaction values for material corporate transactions. The acquisition is not considered material as it represented 0.4 per cent of total assets at 30 June 2024, while the equity component was disclosed in the 2024 annual report as an interest in a joint venture”. MinRes reiterated that its board was “examining a number of issues relating to governance matters and will report back to the market if there are any further material matters”. ACSI last week called on the company to voluntarily invite ASIC in to restore investor confidence after a horror four weeks triggered by disclosures that Mr Ellison evaded tax on equipment sales made through a company in the British Virgin Islands. MinRes has since said that the company’s founder will down within the next 12 to 18 months after damning findings from an external investigation that discovered “at times Mr Ellison has not acted with integrity” and that he “failed to be as forthcoming with the board as he should have been”.