Treasurer Issues Disposal Orders for 1.68 Billion Northern Minerals Shares

Treasurer Enforces Large-Scale Foreign Share Divestment

The Australian Treasurer Jim Chalmers has exercised his powers under the Foreign Acquisitions and Takeovers Act 1975 to issue disposal orders against foreign interests holding approximately 1.68 billion shares in Northern Minerals Limited (ASX:NTU). These orders compel entities from Hong Kong, China, and the British Virgin Islands to divest their holdings within 14 days to non-associated parties, marking a significant regulatory intervention in the ownership structure of one of Australia's leading heavy rare earths companies.

This latest action adds to the interim directions issued earlier this year, which placed restrictions on an additional 361 million shares, primarily involving Hong Kong Ying Tak Limited. Those interim restrictions remain in place, underscoring the government's ongoing concern over foreign control in a sector deemed critical to national interests. Northern Minerals is currently reviewing the implications of these disposal orders and has committed to updating the market once its assessment is complete. The company’s cooperation with the Foreign Investment Division of the Department of Treasury continues amid this regulatory scrutiny.

Foreign Shareholders Targeted in Disposal Orders

The disposal orders specifically target six foreign shareholders, including Hong Kong Ying Tak Limited, Real International Resources Limited, Qogir Trading & Service Co., Limited, Chuanyou Cong, Vastness Investment Group Limited, and Zhongxiong Lin. Collectively, these entities hold substantial stakes acquired over the past two years through brokers and other intermediaries. The orders require these shareholders to offload their shares within a fortnight to unrelated parties, a move that could reshape Northern Minerals’ shareholder base dramatically.

Hong Kong Ying Tak Limited alone is directed to dispose of over 95 million shares, while Real International Resources Limited and Qogir Trading & Service Co., Limited face orders to divest 619 million and 523 million shares respectively. The involvement of entities registered in the British Virgin Islands and China highlights the international dimension of foreign investment concerns in Australia's strategic mineral assets.

Northern Minerals’ Strategic Position Amid Regulatory Pressure

Northern Minerals operates the Browns Range Heavy Rare Earths Project in Western Australia’s East Kimberley region, with its flagship Wolverine deposit reputed to be the highest-grade source of dysprosium and terbium in Australia. These heavy rare earth elements are essential in manufacturing high-performance magnets used in clean energy technologies, defence applications, and advanced electronics, making the project strategically important.

The company has recently completed its definitive feasibility study and is progressing funding discussions to construct a commercial-scale operation. This includes plans to supply ore to Iluka Resources’ rare earths refinery under construction in Western Australia. Despite the regulatory headwinds, Northern Minerals remains focused on advancing its project milestones and securing the capital necessary to bring Wolverine into production.

Regulatory developments have already impacted Northern Minerals’ corporate calendar, with the 2025 Annual General Meeting deferred to June 2026 to accommodate ongoing Foreign Investment Review Board considerations. This follows earlier interim restrictions that blocked transfer and voting rights over hundreds of millions of shares held by foreign investors, including Hong Kong Ying Tak Limited, reflecting the complexity of the situation and the government's vigilance over foreign influence in critical sectors. The company’s continued cooperation with regulators is a key feature of its current strategy, balancing compliance with operational progress.

The Treasurer’s disposal orders represent a rare and assertive use of foreign investment powers, emphasizing the Australian government’s intent to control foreign stakes in companies pivotal to the nation’s clean energy and defence supply chains. How Northern Minerals navigates the forced reshuffling of its shareholder register, and whether new local or allied investors emerge, will be pivotal in shaping the company’s future trajectory.

Meanwhile, Northern Minerals’ recent operational and funding updates, including a $60.5 million capital raise and exploration advances at Browns Range, position it well to capitalise on the growing demand for heavy rare earths. Yet, the looming shareholder changes inject uncertainty into the company’s capital structure and investor confidence, raising questions about the timing and outcome of these enforced divestments.