Australia’s richest person Rinehart shakes up media

A shock move by Australia’s richest person Gina Rinehart into quality newspaper group Fairfax is likely designed to build her influence and reflects the rise of the nation’s mineral wealth, analysts say. Her recent Aus$145.9 million (US$157 million) share purchase came as explosive details of the iron ore heiress’s feud with three of her four children came to light, including emails in which her family plead for bodyguards. Rinehart, whose fortune is said to have the potential to rival the world’s richest men Carlos Slim and Bill Gates, has not commented on her investment in the firm which publishes The Sydney Morning Herald and The Age. But when news of the purchase broke, Australia’s Communications Minister Stephen Conroy was the first to say that Rinehart, who has been critical of a government mining tax, was seeking to exert her influence. Media analyst Peter Cox agrees the foray by Asia-Pacific’s richest woman, which follows her decision to take a stake in free-to-air television station Network Ten, was aimed at having her voice taken more seriously. “Like around the world, you wouldn’t be investing in newspapers... or free-to-air television as a financial investment for the future when both of these industries are facing both structural and cyclical changes,” he told AFP. “I think that would be illogical. Without a doubt she is buying Fairfax shares to have influence.” Cox said he had concerns about Rinehart’s move in Australia, where he said Rupert Murdoch’s News Limited already holds about 68 percent of newspaper circulation, with Fairfax the next biggest player with some 24 percent. The nation has a history of media proprietors such as Murdoch and the late Kerry Packer not having to lobby governments but tending to “pick up the phone themselves and ring the prime minister”, he said. “We already have one person who has a very hands-on approach to the media industry around the world... in the form of Rupert Murdoch.” Cox said that while Fairfax, with its prestigious titles including the Australian Financial Review, had a long and distinguished history of robust reporting, if a powerful figure controlled the group it would be a concern. Fairfax has successfully fought off attempts for control in the past, including by Packer as well as disgraced Canadian magnate Conrad Black whose ambitions were thwarted due to government media ownership laws. Leading media scholar Rod Tiffen, of Sydney University, said Rinehart’s move did not seem “like a wonderfully profitable prospect”. But at the same time he said Rinehart, who is worth an estimated US$18 billion, was unlikely to change Fairfax’s editorial direction given that “the most important thing that Fairfax mastheads have is their credibility”. “And if she started doing things that messed around with that then it would be damaging to the brand. Board members wouldn’t put up with it,” he told AFP. Fairfax has shown no signs of pandering to the deeply private Rinehart since she first bought into the company in 2010, printing details of her relationship with her children, including excerpts of emails in which they plead for cash. “I don’t think you understand what it means now that the whole world thinks that you’re going to be wealthier than Bill Gates — it means we all need bodyguards and very safe homes,” her daughter Hope Welker wrote last year. “I don’t have the money to protect myself or my children and it scares me.” Media analyst Steve Allen, managing director of Fusion Media, said there was “no question” that Rinehart held firm views, but he said the Fairfax mastheads would not bow to her influence even if she joined the board. “I mean 175 plus years of the board being the board and the journalists being journalists and one person buys a stake and it’s all over red rover — please! It’s just silly,” he told AFP. For some, Rinehart’s move is merely an announcement that the incredible mining wealth of her home state of Western Australia, which is driving the national economy, has arrived. Fellow mining billionaire Clive Palmer, whose interests are in coal in the eastern state of Queensland, has also said he would consider joining Rinehart in a Fairfax investment. “It’s a changing of the guard in the sense of mining wealth throwing its muscle into new areas,” said Tiffen.