Mineral Resources and founder Chris Ellison face class action showdown
Mineral Resources and its embattled founder Chris Ellison are facing a courtroom showdown following a series of scandals that have cut the lithium and iron ore miner’s market value in half over the past six months.
MinRes on Wednesday told investors it had been served with a class action lawsuit lodged in the Supreme Court of Victoria on Monday.
“The proceeding relates to matters that have been comprehensively addressed by the company in the market since October 2024,” the company said.
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Shares in MinRes have plunged from $45.86 — just before Mr Ellison admitted to a “lapse of judgment” over his past tax evasion affairs involving the company and a secret deal with the Australian Taxation Office — to $23.78 at Tuesday’s close.
The stunning fall has taken its market value from just over $9 billion on October 18 last year to just under $4.8b.
The retreat began after it was revealed Mr Ellison avoided paying tax for years by not disclosing revenue from co-owned offshore companies in the British Virgin Islands that bought and sold mining equipment for on-sale in Australia.
The billionaire described the failure to declare the revenue as “a poor decision and a serious lapse of judgment”, and said he would step down as managing director and chief executive by May next year.
A review uncovered multiple corporate and governance shortcoming and led to a raft of boardroom changes, including the departure of MinRes chair James McClements, with a replacement due to be announced by the end of June.
Mr Ellison was recently forced to pay a board-imposed penalty of $3.8 million. He has also agreed to donate $5m over the next fives years to charity.
The Australian Securities and Investments Commission is also now probing Mr Ellison’s affairs.
On top of the tax scandal and boardroom shake-up, the miner is also contenting with costly repairs to its trouble-plagued haul road that transports iron ore from its Ken’s Bore mine to the Port of Ashburton.
MinRes is paying $230 million to fix the $2.6b road, which was badly damaged by cyclonic rainfall.
Late last month WA’s workplace safety watchdog forced haulage on the 147km thoroughfare to a temporary halt after a sixth jumbo truck since August toppled over.
More to come.
Originally published on The Nightly
