Northern Minerals delays AGM on China influence concern

31st October 2023

By: Reuters


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MELBOURNE - Australian rare earths miner Northern Minerals has pushed back a shareholder meeting to allow regulators time to assess whether a Chinese national nominated to the board by top shareholder Yuxiao Fund would meet national interest criteria.

Australia's government has said it is looking for friendly nations to build out its critical minerals industry as the West diversifies away from dominant producer China. Northern Minerals is developing in the Browns Range heavy rare earths project in Western Australia.

Treasurer Jim Chalmers in February blocked Singapore-based Yuxiao Fund from increasing its investment in Northern Minerals on national interest grounds.

The private fund lists Chinese national Wu Yuxiao as director. It owns 9.81% of Northern Minerals and had sought Foreign Investment Review Board (FIRB) approval in August 2022 to raise its ownership to 19.9%.

Northern Minerals received regulatory approval to delay its annual general meeting by three months, it said in a stock exchange filing late on Monday, as it sought more information about three board nominees.

Yuxiao Fund has nominated Wu Tao, the chairman of mainland China-based Jinan Yuxiao Group which has invested in mining projects in Mozambique and Australia. The group's website lists Northern Minerals as one of its investments.

"The Board understands that Mr. Wu is effectively the ultimate controller of Yuxiao Fund."

"As the appointment of Mr. Wu as a Director would place Yuxiao Fund in a position to exert a direct influence on the central management and control of the Company, Northern Mineral's board concluded it would be appropriate for Yuxiao Fund to apply to the Foreign Investment Review Board to seek approval for Mr. Wu's appointment," it said.

Northern Minerals said it has not received confirmation from nominee Wu that Yuxiao Fund intends to seek FIRB approval.

Northern Minerals said is also seeking to better understand whether there are links between two other board nominees who may also have ties to Wu and Yuxiao Fund.

Edited by Reuters




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