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Tax trouble grows for indebted Australian coal baron Tinkler
December 13, 2012 / 2:40 AM / 5 years ago

Tax trouble grows for indebted Australian coal baron Tinkler

SYDNEY, Dec 13 (Reuters) - The Australian Tax Office has filed a wind-up action against Nathan Tinkler’s sports group over a A$2.7 million ($2.85 million) debt, widening its pursuit of the embattled mining mogul over missed payments.

The tax office applied on Wednesday to liquidate Hunter Sports Group, the owner of A-league soccer team the Newcastle Jets and rugby league team the Newcastle Knights, adding to similar filings against Tinkler’s holding firm and a financing shelf company.

Tinkler’s empire of coal, horse racing and sports assets -- built on the back of Australia’s mining boom -- appears to be crumbling, with filings at least weekly by creditors against his web of more than 40 companies.

The series of lawsuits over unpaid bills and commercial disputes have raised questions about the future of Tinkler’s main asset, a near one-fifth stake in Whitehaven Coal, Australia’s largest independent coal miner.

There has been little respite for Tinkler, 36, whose wealth has plummeted in line with falling coal prices in recent weeks.

His private jet and helicopter, estimated to be worth around A$45 million, were seized last week by receivers who took control of TGHA Aviation Ltd. Liquidators have also been appointed to his horse racing business, Patinack Farm Administration Pty Ltd, and Mulsanne Resources Ltd over debts totalling more than A$34 million.

The tax office has declined to comment on the extent of the debts owed by the two other companies it is pursuing, Tinkler Group Holdings Administration Pty Ltd and Queen Street Capital.

Tinkler has successfully paid off debts worth millions of dollars in recent weeks to stave off some creditors and avoid public scrutiny of his finances through the courts, including an Irish race horsing stud owned by Sheikh Mohammed bin Rashid al-Maktoum, the ruler of Dubai.


But, in signs of the building pressure, the man who was until recently Australia’s youngest billionaire has been cutting costs across his business.

He is giving up his A$165,000-a-year private suite at the ANZ Stadium in Sydney, the premier sports venue where his neighbours included actor Russell Crowe and the bosses of Australia and New Zealand Banking Group Ltd and Telstra Corp Ltd.

A second discount sale last week of horses has also halved the size of his beloved Patinack Farm, until recently Australia’s largest breeding and racing operation.

Hunter Sports Group, which is already being chased by the New South Wales state government for A$6000,000 in unpaid stadium fees, said on Thursday it was surprised at the action launched by the tax office.

“We advise that any outstanding sum will be paid as soon as possible -- well before the reported hearing date on the matter next February,” it said in a statement, adding it was business as usual for both the Knights and the Jets.

All three cases brought by the tax office are scheduled to return to court in February.

Demand for coal from China, Australia’s major export market, has cooled, shrinking Tinkler’s wealth.

Whitehaven shares were trading at A$3.20, down 1.1 percent, on Thursday. They have lost more than 40 percent since a $5 billion merger of Tinkler’s companies Aston Resources and Boardwalk Resources with Whitehaven in April.

That cut Tinkler’s holding, which sources have told Reuters is heavily leveraged, to around A$600 million, compared with A$1.1 billion at its peak.

Tinkler’s main backer, U.S. hedge fund manager Farallon Capital Management LLC’s asset manager Noonday, has been looking at options including pressing for the sale of shares or converting some of the loans into equity. ($1 = 0.9485 Australian dollars) (Reporting By Jane Wardell; Editing by Paul Tait)

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