My name is Gina show me the money

IN EARLY June, amid the fracas over the federal government's resource rent tax, the country's most secretive and reclusive billionaire donned her pearls, clambered on to an old flat-bed truck, believed to have once belonged to her father, and took to the streets of Perth shouting the rally cry: "Axe the tax."

The sight of Gina Rinehart on the back of a work truck, sporting a string of pearls and high heels, was certainly incongruous.

Former West Australian attorney-general Jim McGinty says the image, splashed across the media, left an indelible impression. "All I could think of was Gordon Gekko shouting 'greed is good'," McGinty says. "Gina was basically saying 'I don't want to pay my fair share of tax, I want to enjoy what I inherited from daddy'."

For some of the people who know Rinehart, the image symbolised a schism within the billionaire. It is the conflict between the idolatry of her father, the legendary prospector Lang Hancock (a planet is even named after him) and the recasting of her own image as a self-made woman.

This week, Forbes magazine estimated Rinehart's fortune at $9 billion a phenomenal increase from merely $2 billion last year and named her Australia's richest person. Never before has the country's richest person boasted such incredible wealth. Never before has the richest person been a woman.

With the Pilbara's riches unlocked, Rinehart is spending part of her fortune on media assets, including stakes in Ten and Fairfax (owner of The Age), which has put the otherwise publicity-shy mining mogul in the spotlight.

Today, BusinessDay looks into her world. Our story draws on more than a week of emailed discussions with Rinehart, as well as extensive interviews with her "inner sanctum" and some who have crossed swords with her, to gain an insight not only into what makes this secretive and powerful woman tick, but also her plans for media, politics and her mining empire.

LANG Hancock's discovery of iron ore in the Pilbara, with long-time partner Peter Wright, is legendary in Australian mining circles. It was a find of global significance, and has made both families filthy rich.

But when his daughter Gina, then a 38-year-old widow and mother of four, took over the family company on his death in 1992, the estate was bankrupt and the business mired in debt. It took her more than 10 years, as well as two vitriolic legal battles, to emerge from the wreckage and the shadow of her colourful and controversial father.

The first fight was with Rose Porteous, her stepmother and Hancock's former maid, for control of the Hancock estate.

The drama was public and ugly. Porteous was accused of black magic and voodoo, and Rinehart was accused of buying witnesses and built a reputation for being highly litigious.

The second fight was with the children of her father's business partner, Peter Wright. Wright and Hancock were of an age when deals were done with a handshake, but their offspring fought over the spoils, in particular Rhodes Ridge, one of Australia's richest undeveloped iron ore deposits.

The cases arguably provided a salutary lesson that, without control, you can lose everything.

For Rinehart, the fights were something else. "This is something some newspapers like to say if a female is involved in litigation, whereas they don't label males involved in more litigation as 'highly litigious'," she says.

"It would have been easier, I can assure you, if our company group was not in the position of having to defend itself against numbers of people who tried to acquire more from what dad, or dad and I, had strived very hard to build.

"If we could have just focused our time and energy on getting on with fixing the company group problems and our companies' enterprises, that would have given us plenty to do, but instead we had somewhat more to contend with."

An obsession with control may explain why Rinehart shuns media interviews, has a revolving door for executives and advisers who don't agree with her, and micro-manages her growing empire.

According to one of Rinehart's peers, who shares the rarefied air of the nation's rich list, a desire for control has stymied what could be an even bigger empire. "She could have bankrolled enormous numbers of projects, created huge employment, but she keeps iron-clasp control on the royalties and this desire not to release control brings down a lot of business proposals," he says.

Jay Newby, chief financial officer of Hancock Prospecting and one of a small group of people close to Rinehart, says such comments are nonsense.

"The royalties were used to pay off debts/liabilities caused pre-Mrs Rinehart's chairmanship and hence were not available to build any projects at all throughout the 1990s . . . Any talk by unnamed sources that these royalties could have bankrolled enormous projects is entirely misplaced and simply wrong."

The royalties Newby is referring to came from a deal struck by Rinehart's father and his business in 1962 to sell iron ore rights in the Pilbara to CRA, which later became Rio Tinto. They received cash, and a royalty in perpetuity, valued at 2.5 per cent of the iron ore mined by Rio Tinto in the Pilbara.

At current prices, that royalty spits out a fortune estimated at about $100 million a year for both Rinehart and the estate of Peter Wright. Newby denies media estimates, but refuses to divulge the true figure.

Rinehart now negotiates with giants in the male-dominated world of mining. It's a long way from her days at exclusive Perth girls' school St Hilda's. Rinehart would later drop out of Sydney University after just one year of economics because, as she told BRW in 1982, "they were teaching all the wrong things".

According to friend Jack Cowin, to understand Rinehart you need to understand her father.

Cowin, the founder of food chain Hungry Jack's and a fellow director on the Ten Network board, has known Rinehart more than 40 years.

"With Gina, there has never been any young, shy, little schoolgirl who has blossomed into the business magnate," he says. "There are Lang's characteristics that have been with her all her life.

"If you know her, then you'll appreciate she's a private individual. In many ways, she has achieved what she set out to do through this family trait of single-minded persistence in achieving a goal. She's very strong-willed and strong-minded."

That goal was to build an iron ore mine in the Pilbara. "Lang died with that dream unfulfilled, and Gina has spent her entire adult life pursuing the completion of her father's dream," Cowin says.

Tim Treadgold, a senior writer for Forbes and the Eureka Report, says: "She followed her father into iron ore, coal, the media and politics.

"He founded newspapers, funded far-right-wing political parties that favoured WA seceding from the rest of Australia and he acquired control of vast tracts of iron ore resources in the remote north-west Pilbara. She is a continuation of the line."

Treadgold was also the subject of a tirade last year, when he referred to Rinehart as an "heiress". Rinehart published an article on her website that suggested Treadgold was "rather stupid". Other journalists who call her an "heiress" get a similar reaction.

It gives an insight into Rinehart's inner turmoil. She puts her father on a very high pedestal. There is the Hancock Range in the Pilbara, and the main rail line to her joint venture with Rio Tinto is the Lang Hancock Railway. The Hancock Prospecting office also contains a bust and pictures of Hancock.

But Rinehart also wants it to be known that her wealth had nothing to do with his estate but was the result of her own work and business acumen.

"It is a very real problem that she has created for herself by denying she is an heiress and that she inherited a mess, because she is in effect criticising him, yet she also immortalises him," Treadgold says. "Was he a bankrupt with troubles, or godlike? Which is it? He can't be both. That's something she has to work out."

For Cowin, it is difficult to comment on Rinehart's reaction to being called "heiress".

"I have read the heiress comments, and I have read Gina's comments and spoken with her about it," he says. "I do know that the business wasn't a fait accompli. This wasn't just clipping the coupons as they came in. There were significant issues when Lang died and it was Gina who had to deal with the major mining companies of the world."

Cowin is one Rinehart's few easily identifiable friends.

Like the Pratt family in Melbourne, or the Packers in Sydney, Rinehart could easily take a place at the summit of Perth society. Instead, she chooses to be a loner.

She is a workaholic and says that as the company is growing, "I take working holidays generally accompanied by staff as the work rarely stops". Her office is a high-security haven, complete with bulletproof glass.

Clive Palmer, the billionaire miner who, along with Rinehart and Andrew Forrest, was one of the three faces of the anti-mining tax fight, says he hasn't met her.

Even at work, which has consumed Rinehart's life, few get close. In Perth mining circles, many speak of the "revolving door" of executives, accountants, political consultants, lawyers and geologists.

Rinehart makes no apologies for being a demanding boss.

"Our company has been built on hard work and best endeavours, while facing difficult times," she tells BusinessDay. "It is not always easy to find people who can cope with all this, but in the executive area we have been fortunate and still have several long-term staff and some great new executives, too, who will help our company to continue to grow."

Tension has even extended to her family, with her son John changing his name by deed poll to John Hancock, and then threatening her with legal action.

According to reports, the pair have since mended fences. On this, Rinehart makes no comment.

Amid such tumult within the business and the family, many in the mining industry question whether Rinehart's multibillion-dollar empire is the result of ability, or boils down to sheer luck. They also question whether the company has the management depth to continue to grow.

"One person can't run a multibillion-dollar empire," a mining executive says.

Hancock Prospecting executive director Tad Watroba says: "Mrs Rinehart does run our company group extremely well. Given our group's continuing success, it would be strange to say otherwise."

Considering the family history, others wonder if any succession plan is in place. Rinehart's response: "There is recent media speculation. Given the increasing size of our company group, my successors will be based on merit."

Like Rinehart herself, the origins of the family riches are an enigma. Rinehart has stakes in a few public companies worth less than $400 million, including Ten Network and Fairfax Media, but most of her empire is privately held and owned through a labyrinth of family trusts.

It might seem ironic that, in the past year, this media-shy woman has emerged as a key player in the media industry she seems to dislike. But, like her father, Rinehart is on a mission to change public opinion, to lift the importance of mining in Australia and redefine government policy.

Some of Rinehart's hobby horses include abolishing the resource rent tax, introducing cheap Asian labour, in the form of "guest workers", to develop Australian mines, and challenging the science of climate change.

The mining tax protests in Perth gave Rinehart another taste of the media's power.

Less than six months later, that taste for power and influence translated into a 10 per cent stake in Ten Network (a move that won her a seat on the board with James Packer, Lachlan Murdoch and Jack Cowin) and a 4 per cent stake in Fairfax Media.

The media buys have prompted a great deal of speculation about her intentions. "Gina doesn't seek publicity but, the fact that she's now in the media industry, I told her, you better get used to it," Cowin says.

Only months have passed, but already men close to the Packer camp are expressing concerns about "whether or not James can do business with Gina" in the wake of her investment in Ten.

"They have had two face-to-face meetings so far," says a person close to the Packer camp, just before Christmas. "It's fair to say that James doesn't get where's Gina's coming from yet. It's a relationship that is going to have to develop."

The federal government is also keeping a close eye on the relationship between Packer and Rinehart. "If you map it out, then James Packer is far and away the most powerful man in Australian media, more powerful than his father was, if less overt," a senior government figure says.

"Add James's quarter share of Foxtel to his recent purchase at Ten, plus his half-share of Premier Media, then look at his close relationship to Lachlan Murdoch. His best friend is David Gyngell, who runs PBL Media and the Nine Network. Kerry Stokes owns part of Consolidated Media. James has the ear of just about every major media outlet in Australia, and now Rinehart has bought a seat at the table alongside him."

Using the media as a lever to pressure the government is something her father did. Hancock's political victories take prominence in a timeline marking the history of Hancock Prospecting on the company website. So does the creation of the The Sunday Independent newspaper in 1969 and the National Miner in 1974.

As a former associate says: "The big question many of us ask is what is she doing? Is her iron ore empire an unstoppable exponential force due to price increases in iron ore fuelled by China or is she doing something right to create that outcome for herself? Is this all good luck because the old man staked his claim or is she adding value along the way?"

With an expanding mining empire, her media interests and potential fights with the federal government over tax, many question if one person can do it all.

Treadgold cautions: "If she isn't careful she will blow it all up."