(May 18): Australia’s government has ordered the biggest shareholders in rare earths firm Northern Minerals Ltd to sell their stakes, the second such intervention in two years as Canberra seeks to protect the company from China-linked investors on national security grounds.
Six shareholders in the A$229 million (US$163 million or $209 million) firm must sell their stakes within two weeks from Monday, according to a statement from the Treasury. Five of them are registered in China or Hong Kong, according to the statement, and one in the British Virgin Islands.
Four of the entities are the largest holders, according to data compiled by Bloomberg, including top investor Vastness Investment with around 7%. Altogether, the six entities hold almost 27% of the outstanding float, the data show. Shares in the company fell more than 8% in morning trade before paring some of the loss.
The order follows a similar move in 2024, when the government instructed five investors to sell their stakes in Northern Minerals. Canberra eventually sued a Chinese company for breaching that directive, winning the court case last year. However, last month the Treasury said it was concerned some of the parties had breached the order.
The Perth-headquartered miner in a statement on Monday said it is considering the latest orders from the Treasury and would update the market at a later time.
Western nations including Australia and the US have attempted to limit Chinese investment in so-called critical minerals and metals key for defence industries and the energy transition. Beijing has a near-monopoly on rare earth production and processing, and has leveraged export controls during trade disputes with the Trump administration since last year.
See also: Indonesia plans to tighten state control over commodity exports — Bloomberg
Northern Minerals’ Browns Range project is yet to be developed but is a sizeable deposit of so-called heavy rare earth elements, which are used in military applications and advanced electronics. The asset sits in the Pilbara region of Western Australia and has received non-binding letters of support from the US and Australian governments for future development.
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