Andrew Forrest has gone from Australia’s richest man to its eighth, after his split with wife Nicola and donations to the family charitable foundation reduced his paper wealth by 60 per cent within a month.
Nicola Forrest has entered the Rich List for the first time ranked eighth overall, and third-richest woman, with a $14.6 billion fortune. Her estranged husband is 10th with $13.5 billion.
Andrew and Nicola Forrest on the banks of the Swan River in Perth last month. The couple have since announced their separation.
Gina Rinehart remains Australia’s richest person with a $38.2 billion fortune as iron ore prices hold up, while property developer Harry Triguboff ($24.5 billion) becomes Australia’s richest man again, having previously held the title in 2016.
Canva co-founder Melanie Perkins is the second-richest woman, with a $16.2 billion fortune held alongside husband Cliff Obrecht, as the implied valuation of the graphic design platform increases in line with a resurgent NASDAQ technology index.
As recently as May’s Financial Review Rich List, the “Andrew Forrest” entry was second at $33.3 billion. Nicola’s name has not previously featured, under List rules which restrict the names in entries to those with a direct role in having built the fortune.
That is unless assets comprising that fortune have become owned by others independently. In February, three of six shares in Tattarang Pty Ltd, the entity that owns 36.7 per cent of Fortescue Metals Group, were transferred from Andrew to Nicola. Under Rich List rules, the couple’s formal separation means they are now assigned to Nicola’s valuation alone.
There was also June’s transfer of 50,000,000 Fortescue shares, currently worth $555 million, to Coaxial Ventures Pty Ltd, an entity wholly owned by Nicola Forrest.
Fortescue assured the market on Thursday morning that Andrew Forrest, its executive chairman, remained “associated” with the majority shareholding in the iron ore miner, and that there would be no change to its control or direction.
However, only the beneficial ownership of shares counts in Rich List calculations.
Assuming an equal division of the couples’ vast unlisted assets, such as their farms and their private equity investments in companies like boot maker R.M Williams, the Coaxial transfer means Nicola Forrest becomes slightly wealthier than her husband.
That is a somewhat moot point given the couple have signed the Giving Pledge, set up by American billionaires Warren Buffett and Bill Gates, under which they have agreed to give away the “vast majority” of their wealth.
It was to this end that in June the couple transferred one-fifth of their Fortescue holding worth $5 billion to their charitable Minderoo Foundation, knocking their combined wealth at the time down to $28 billion.
The Forrests’ statement to the Financial Review confirming their separation on Wednesday evening said their philanthropic ambitions were unchanged.
The Forrests were unlikely to have had a binding financial agreement (the Australian term for a prenuptial agreement) when they married 31 years ago. According to family lawyer Angelina Torrisi, whose Sydney practice specialises in handling divorces among the well-heeled, they were less common in the 1990s.
However, she said such agreements were increasingly being put in place during a marriage after a significant financial windfall, such as when Fortescue shares took off during the 2007 mining boom. The Forrests’ camp referred to the couple’s earlier statement when asked if a binding financial agreement existed between Andrew and Nicola.
Most settlements following a separation were agreed outside the Family Court, Ms Torrisi said, especially where a binding agreement was in place. However, in either case assets were rarely split exactly in half.
“For instance, if the husband takes over all the shares of an operating business, the liabilities and risks associated with that are generally taken into account,” she said.
“So the business might be worth more on paper than unencumbered property, but the Court might consider them equal.”
The Forrests’ separation may eventually cause Andrew and Nicola Forrest to diverge widely on the Rich List, even if the general trend of their wealth is downward as they fulfil the terms of the Giving Pledge.
The other major recent divorce among Rich Listers, that of Platinum Asset Management founder Kerr Neilson and former wife Judith Neilson, saw her valuation overtake that of her husband from 2020 onwards as he held on to more Platinum stock despite a structural decline in its price.
Judith, on the other hand, ploughed much of her fortune into price-resilient Sydney property.
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