Skip to main content
Part of complete coverage on

Rags-to-riches billionaire's debt woes mount

By Monica Attard, for CNN
updated 10:28 AM EST, Fri November 23, 2012
File photo of Nathan Tinkler in October 2008 in Melbourne, Australia.
File photo of Nathan Tinkler in October 2008 in Melbourne, Australia.
  • Billionaire Nathan Tinkler's rags-to-riches story in peril as his debt woes increase
  • On Tuesday an Australian court ordered the liquidation of his personal holding company
  • The 36-year-old mining magnate's racing empire and sports empire are in trouble
  • Just nine years ago, Tinkler was an electrician working in the mining industry

(CNN) -- Nine years ago he was an electrician. Six months ago, he was worth some A$1.18 billion ($1.22 billion) Australia's mining boom having turned him into the country's richest person under 40 years old.

Now, coal baron Nathan Tinkler, 36, is facing a mountain of debt. His wealth has plummeted to A$400 million, thanks to slowing demand and falling coal prices, while his debts to a variety of creditors mount, reportedly hitting A$638 million. On Tuesday, his personal holding company was liquidated.

Tinkler has had the Midas touch on his way to the top of the rich list and -- until Tuesday -- on the way down, too, staving off the liquidation of several of his companies. He now faces credit debt surrounding his horse racing empire, troubled sports franchises and repossession of his personal jet.

While creditors have been circling for months, it was a Tuesday decision of the New South Wales Supreme Court to wind up Tinkler's Mulsanne Resources over an unpaid A$28.4 million dollar debt that suggests the former electrician's luck may have run dry.

Australian treasurer on nation's economy
BHP shelves Olympic Dam expansion
Australia's foreign economic threats
Are S. African miner demands justified?

On Wednesday, the Federal Court place his thoroughbred horse racing and breeding empire, Patinack Farm Administration, into liquidation with a debt of A$2 million. Patinack Farm's cash flow problems were reported to be so severe, Tinkler was trying to stem the bleeding by downsizing operations in Victoria and South Australia and selling horses at bargain base prices to settle a state debt.

He recently settled a A$16.6 million dispute with Mirvac over a failed land purchase in Sydney and a A$2 million debt to the publicly listed contractor, Sedgman Ltd.

Tinkler's woes have impacted the Australian sporting world too. His Hunter Sports Group has reportedly fallen behind in meeting player salaries for his two prized clubs -- the A league Newcastle Jets football team and the Newcastle Knights league club. But Tinkler has come up with enough money to partially pay a significant, unpaid bill for the rent of stadiums used by the teams.

And he has avoided the reported repossession of his personal jet worth A$40 million. GE Capital is said to have issued Tinkler an instruction to leave the French made Dassault Falcon 900, replete with Italian leather seats, a conference room and bar, at a regional Sydney airport.

Instead, he flew it to Singapore where he and his family now live in two adjacent homes, reportedly with a Maserati and Porcshe in the driveway.

And in August with coal prices flailing, Tinkler abandoned plans for a A$5.3 billion take over Whitehaven Coal, one of Australia's largest coal producers with exploration assets in Queensland. Tinkler's Aston Resources, however, remains the largest shareholder in Whitehaven Coal with a 19.4% stake.

Navigating the downside of Australia's commodities boom is proving to be a wild ride for Nathan Tinkler. As a result, the unlikely rich lister is in the business pages of Australian newspapers almost daily. And he doesn't much like the attention.

"There has definitely, absolutely, been a spirited media campaign to get me," Tinkler told Sydney's Daily Telegraph earlier this month.

Seeking to sooth the doubters, he added, "I would say the noisy few have made a lot of people nervous and there is no need to be."

The order to liquidate his personal investment vehicle would indicate the nervousness is not a fiction of a media campaign.

But Tinkler is accustomed to wild rides. The ride to the top for Australia's fastest self-made billionaire was not only wild. It was a gamble.

As a teenager, he headed for the rich coalfields of the Hunter Valley, north of Sydney, according to a 2010 profile. There, he found work in the mines as an electrician, though a A$400 a week take home salary held little appeal.

By 26, he'd formed his own mine machinery maintenance business, servicing coalmines, which were burgeoning and booming as Australian commodities fueled the expansion of China's infrastructure.

Then came his big break.

In 2006, he raised a A$1 million loan against his home and business for a deposit on a coal tenement in central Queensland. All he needed to do was raise another A$29 million to finance the deal.

"I knocked on every door in Australia and many overseas to raise the funds. Finally I succeeded after wearing out a lot of shoe leather, " he told CNBC in 2010.

Investors came on board when exploratory drilling turned in heaven sent results - high grade coal samples.

Sitting on a promising asset, Tinkler sold it not once but twice -- first to Macarthur Coal for A$275 million plus a 10% stake in the company and a year later, in 2008, with world coal prices soaring, he sold his stake in Macarthur to global steel giant ArcelorMittal.

His A$1 million gamble turned into a multimillion dollar pile of cash with which he went on a buying spree -- football and rugby league clubs, horse studs, as well as property. He also formed Aston Resources, a mining development vehicle, floated in 2010.

The Aston Resources merger with Whitehaven Coal was his great hope and even diminished by weak coal prices, it remains his main asset.

If the former electrician can't pull another rabbit out of his hat, faith in the Midas touch may be all that remains to stave off bankruptcy.

Part of complete coverage on
updated 8:36 AM EDT, Mon August 18, 2014
Europe's deteriorating relationship with Russia has hit the region's growth, even before new food sanctions begin to bite.
updated 12:34 PM EDT, Wed July 16, 2014
With cyberattacks on the rise and here to stay, it's a modern-day challenge for people and businesses to get smarter about preventing them.
updated 9:24 AM EDT, Thu August 14, 2014
Airstrikes, rebels seizing control of oil fields, plus a severe refugee crisis are a recipe for market panic. So why are Iraq oil prices stable?
updated 11:24 AM EDT, Sun July 20, 2014
Evidence points to pro-Russian separatists as perpetrators of the attack and Vladimir Putin is facing uncomfortable questions, David Clark writes.
updated 10:40 AM EDT, Tue August 5, 2014
The biggest Ebola outbreak in history is taking its toll in Western Africa, hitting some of West Africa's most vulnerable economies.
updated 5:02 AM EDT, Thu July 3, 2014
Macau has overtaken Switzerland in the wealth stakes, being named the world's fourth richest territory by the World Bank.
updated 10:47 AM EDT, Fri July 18, 2014
Saudi Arabian Bateel brand is best known for its delectable dates but it now has more than a dozen cafes and a new bakery in the works.
updated 7:00 AM EDT, Thu July 17, 2014
A British nanotech company has created what it says is the world's darkest material. It is so dark the human eye can't discern its shape and form.
updated 12:02 PM EDT, Wed July 16, 2014
Jibo robot is designed to be an organizer, educator and assist family members. CNN's Maggie Lake met him and says she was impressed with his skills.
updated 5:09 PM EDT, Fri July 18, 2014
American burger joints have sprung up all over London, but how to know which ones are best? CNN's Jim Boulden investigates.
updated 8:22 AM EDT, Wed June 18, 2014
Sandwiched in between Iraq and Syria, Jordan's destiny seems to be one of a constant struggle for survival. John Defterios explains.
updated 11:02 AM EDT, Wed June 18, 2014
At the last football World Cup, it was all about 3D. This time around, it's nothing less than 4K.
updated 6:58 AM EDT, Wed July 16, 2014
Bob Mazzer has photographed inside London's Tube network for 40 years. He's captured history.
updated 1:12 PM EDT, Fri July 18, 2014
Exotic animals are becoming a profitable business opportunity for Nicaraguan entrepreneurs. CNN's Rafael Romo reports.
updated 11:29 AM EDT, Fri June 13, 2014
Iraq produces 3.3 million barrels per day and has the world's fourth-largest oil reserves. But the current crisis is putting all this in danger.
updated 8:22 AM EDT, Wed June 18, 2014
Sandwiched in between Iraq and Syria, Jordan's destiny seems to be one of a constant struggle for survival. John Defterios explains.
updated 9:14 AM EDT, Mon June 16, 2014
The gas standoff between Russia and Ukraine could have a knock-on effect on Europe. Explore this map to find out why is the EU nervous.
updated 6:58 AM EDT, Wed July 16, 2014
Bob Mazzer has photographed inside London's Tube network for 40 years. He's captured history.
updated 8:06 AM EDT, Tue June 17, 2014
The UK capital promotes its tech stars and shows it can compete with Silicon Valley. Here are five companies that pitch to make it big.