Australia orders Chinese investors to sell stakes in rare earth miners | Wilnesh News

Australian Treasurer Jim Chalmers has ordered several China-linked investors to sell their stakes in rare earths miner Northern Minerals, citing national interest concerns, a spokesman said on Monday.

Northern Minerals is developing the Browns Range heavy rare earths project in Western Australia, an industry that has become increasingly strategic for green energy and defense applications.

The disposal order issued by Chalmers on Sunday said Yuxiao Fund has 60 days to dispose of the 80 million shares it purchased in September.

Reuters previously reported that Yuxiao Fund is a private investment vehicle registered in Singapore by Chinese citizen Wu Yuxiao. The fund had sought Foreign Investment Review Board (FIRB) approval to increase its stake in Northern Minerals from 9.81% to 19.9% ​​in 2022, but it was rejected last year.

Northern Minerals chairman Adam Handley said in a statement to Reuters that the company had referred certain share purchases to FIRB for investigation in October last year.

“Northern Minerals submitted its application to FIRB because we have a duty to act in the best interests of all shareholders, ensure the integrity of the company’s share register and uphold our high standards of good governance,” he said, adding that this would not create Any development affecting mines in the Browns Range.

Overall, the number of shares that must be divested represents approximately 10.4% of Northern Mining’s issued share capital, and with Yuxiao Fund’s shareholding, the ratio would be close to 20%, the ratio at which a party would declare its intention under Australian takeover laws .

Northern Mining said the fund is controlled by Wu Tao, chairman of Jinan Yuxiao Group in mainland China. Other foreign shareholders ordered to sell their shares within 60 days include Ximei Liu, Xi Wang and Black Stone Resources, the notice said.

“The Treasurer has issued an order requiring Yuxiao Fund Pte Ltd and four partners to reduce their holdings in Northern Minerals,” a Chalmers spokesman said in a statement on Monday.

“This decision was taken on the advice of the Foreign Investment Review Board to protect our national interests and ensure compliance with our foreign investment framework.”

Browns Range will supply Iluka Resources’ Eneabba rare earths refinery under construction in Western Australia, which has secured a A$1 billion (US$665.1 million) funding commitment from the Australian government and awaits further decisions.

Australia says it is looking for friendly countries to build its key minerals industry as Western nations diversify away from major producer China.

Last week, Northern Mining chairman Nick Curtis quit the company’s board. Curtis declined to comment. Northern Minerals shares were little changed at A$0.035. The company’s annual general meeting will be held on June 6.

Canberra has scrutinized foreign investment in key sectors, including critical minerals, over national security concerns and blocked some Chinese deals that have angered Beijing.

Australia is preparing for a visit by Chinese Prime Minister Li Qiang later this month. When Chinese Foreign Minister Wang Yi visited Australia in March, he expressed hope that Australia would ensure that its market environment does not discriminate against Chinese companies.

A Chalmers spokesman said Australia’s foreign investment framework did not discriminate against any country.