Trading Halted as VDM Faces JV Dispute and Compliance Challenges on ASX

Operational Disruption in Angola

VDM Group Limited’s March 2025 quarterly report reveals a significant operational setback stemming from a dispute with its Angolan joint venture partner, Pebric Mining Consulting LDA. This disagreement has led to a suspension of all exploration activities on the Cachoeiras do Binga and Bengo projects, which VDM holds a 55.25% interest in. The dispute involves contested ownership rights and alleged breaches of joint venture agreements, effectively freezing progress on these key assets.

ASX Suspension and Compliance Challenges

On 20 November 2023, the ASX suspended trading of VDM’s securities due to non-compliance with Listing Rule 12.1, which requires companies to maintain adequate operations to warrant continued quotation. The suspension remains in place as VDM works to demonstrate sufficient operational and financial stability to the exchange. This regulatory action underscores the severity of the dispute’s impact on VDM’s business continuity and investor confidence.

Financial Position and Funding

Despite the operational challenges, VDM reported cash reserves of AUD 1.967 million as of 31 March 2025, slightly down from AUD 2.072 million at the end of 2024. The company also carries loan facilities totaling AUD 12.511 million, primarily sourced from its largest shareholder, Kengkong Investments Pty Ltd, controlled by Chairman Hiuming Luk. Interest accruals and foreign exchange adjustments have increased the loan balance since the previous quarter. Related party payments amounted to AUD 78,000 during the quarter, reflecting ongoing corporate governance disclosures.

Strategic Pivot to Critical Minerals

In response to the impasse in Angola, VDM is actively exploring new project opportunities focused on critical minerals such as uranium, lithium, copper, and gold, predominantly within Australia. This strategic pivot aims to align with global demand trends for critical commodities and to build a portfolio capable of generating early cash flow. The company emphasizes that these new ventures are intended to complement existing assets and support the eventual recommencement of trading on the ASX.

Outlook and Compliance Milestones

VDM has largely addressed outstanding ASX lodgements, including its FY24 annual report, and expects full compliance by the end of June 2025. The company’s ability to resolve the joint venture dispute and secure new project funding will be critical to restoring market confidence and resuming active trading. Meanwhile, the suspension serves as a stark reminder of the operational and regulatory risks inherent in international joint ventures within the mining sector.