Six companies – five of them headquartered in China or Hong Kong – have been forced to sell off their holdings in an Australian rare earths miner amid fears of foreign interference.
Treasurer Jim Chalmers has given the overseas-owned businesses 14 days to dispose of their shares in Northern Minerals, a company which hopes to extract dysprosium and terbium in Western Australia’s East Kimberley region.
The federal government views the rare earths miner as a crucial part of its efforts to fight China’s hold on the global critical minerals supply chain, but Northern Minerals has been the subject of a number of boardroom tussles with mysterious wealthy shareholders.
Dysprosium and terbium are used in the manufacture of specialised magnets, which are useful for electric vehicles, wind turbines and industrial robots.
In total, the sell off from Hong Kong Ying Tak, Real International Resources, Qogir Trading and Service Co., Chuanyou Cong, Vastness Investment Group and Shongxiong Lin will affect 17.5 per cent of the mining company’s shares, worth roughly $40 million.
“This decision was entirely consistent with advice from Treasury and the Foreign Investment Review Board. It’s about protecting our national interest and ensuring compliance with our foreign investment framework,” Dr Chalmers told reporters in Brisbane on Monday.
“We operate a robust and non-discriminatory foreign investment framework, and we will take further action if it’s necessary to protect our national interest in relation to this matter,” he said.
In January Vastness Investment Group – one of the companies now being forced to divest – made an unsuccessful bid to remove Northern Minerals’ chairman Adam Handley.
Company and government officials suspect the Chinese shareholders have been making a concerted effort to stymie the business’ efforts to establish its projects.
The Foreign Investment Review Board believes a group of Chinese individuals, who’d previously been forced to sell off their holdings, had given them to Hong Kong Ying Tak – which has also been included in the latest sell-off order.
In March, Qogir – another one of the companies named by Dr Chalmers – sold off more than 28 million shares, but still retained a nearly five per cent stake in Northern Minerals.
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