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Jim Chalmers, Treasurer of the Australian Government, moved to block a Chinese company from increasing its ownership of a rare earths company, Northern Minerals Limited (ASX:NTU). Chalmers has been vague as to the exact rationale behind this decision. However, he claims the decision is supported by advice from the Australian Government’s Foreign Investment Review Board. Nick Curtis, the executive director of NTU, told Reuters that it was related to “national interest”.

Yuxiao Fund Pte Ltd – a Singapore-based investment vehicle owned exclusively by Wu Yuxiao – attempted to increase its stake from 9.92% to 19.9%. While this move was denied, Yuxiao Fund still maintains its nearly 10% stake in NTU. NTU has publicly announced its intent to become a globally renowned producer of dysprosium, a component for magnets in electric vehicles. The below graphic is pulled from one of the company’s filings with the Australian Stock Exchange (ASX).

This increased focus on dysprosium is in line with NTU’s history of mining and investment in rare earth metals. However, increased Chinese investment in this company is potentially part of a longer-term plan by the Chinese to gradually acquire a controlling share of NTU. This would give a Chinese company influence over NTU’s mining and refinement of uranium in Australia.

The Wu Family Mining Dynasty

Wu Yuxiao is far from the only Chinese investor in NTU, but he holds the largest stake with over 9.5% of the voting rights. The next largest shareholder has approximately 7.38% of the voting rights as of this writing.

Wu Yuxiao (Right) and his father, Wu Tao (Left), run a family mining conglomerate Jinan Yuxiao Group (JYG). JYG operates out of Jinan, Shandong, China, but owns the majority of the mining industry in Mozambique, where the Wu family can be tied to a multitude of shell companies in Maputo.

On their public website JYG depicts their current projects and affiliations in Mozambique. The Wu family is no stranger to the mining industry; their operations in Mozambique are primarily utilized to extract and export titanium alloys to China. There have been several allegations by local law enforcement in Mozambique that the company engages in human trafficking to support their mining operations.

Northern Minerals (FKA Northern Uranium)

Northern Uranium Limited was listed on the Australian Stock Exchange on November 15, 2006 under ASX:NTU, and rebranded as Northern Minerals in February 2011. This is important to note because most press releases put a strong emphasis on Northern Minerals’ production of dysprosium. It is also vital to recognize NTU’s other investments in Australia, such as uranium mining, regardless of the brand name.

Prior to their name change in 2011, NTU had a close business relationship with Areva, a large French conglomerate that specializes in nuclear enrichment and reactors. When the ASX announced the company name change from Northern Uranium to Northern Minerals, NTU Managing Director George Bauk stated “Uranium drilling will also continue on the NTU’s uranium targets [after the name change]”. The company’s connection to uranium and nuclear energy is well-documented and removing “uranium” from the name hasn’t altered its business interests.

The chart below displays the Australian uranium deposits that were known at the time of the above comment by Bauk in comparison to NTU’s other ongoing projects.

China and NTU

When NTU initially raised capital by listing on the ASX in 2006, the prospectus didn’t show any obvious international investment of concern. In early 2010 a Chinese national involved in the steel industry in Beijing – CongLin Yue – purchased 7.7 million shares worth AU$2.7 million with the help of a loan shark in Mongolia.

CongLin Yue

Also in 2010, the East China Exploration & Development Bureau attempted to invest AU$15.7 million in NTU. While this transaction was never finalized, it showed China’s long term interest in the operations of NTU.

Based on his investment of AU$8 million into NTU, CongLin holds 4% of the voting power in all NTU decisions. Of interest is the fact that this large investment was interest free for NTU. Shortly after negotiations with CongLin began, NTU filed a new rights issue with ASX, and provided millions of shares to CongLin at a premium price.

Through favorably priced share sales like the one provided to CongLin, NTU has continued to raise capital from wealthy Chinese nationals and China-based companies such as the Northern Rare Earth Industrial Group Limited based in Baotou, China. NTU’s governance has made it clear that they are friendly to foreign investment from Chinese nationals and sovereign wealth funds.

Currently the top 25 NTU shareholders are mostly Chinese nationals and companies based in China. The 10 largest investments in NTU by Chinese interests hold over 40% of the voting rights. Additionally, the board of directors is composed of Australian business people with a history of business relationships with Chinese nationals and corporations. The Executive Director of NTU, Bin Cai, has worked with The China Investment Bank and works directly with CongLin as a director of an investment vehicle. The Chinese Investment Bank has a history of funding projects for the Chinese Belt and Road initiative, usually to the detriment of smaller countries involved in these development projects.


Yuxiao’s attempt to purchase an additional 10% of the company would give Chinese shareholders control of 51% of NTU stock. While this 51% would be held by several different investors, it would result in foreign control of a company actively producing Australian strategic materials. Given NTU’s historic control of uranium and other radioactive isotope deposits in Australia, Chinese nationals would have potentially been able to reduce or redirect the flow of these limited resources.

NTU continues to publicly emphasize its dysprosium production, but the production and refinement of this rare earth material has so far been largely conceptual. Their first dysprosium producing plant opened in 2018, but so far has only produced limited quantities. In the context of increased global interest in electric vehicles, dysprosium production in Australia is a large incentive for Chinese investment. However, the fact that NTU also mines and produces uranium and other radioactive materials makes it an attractive investment for Chinese mining interests.

In this specific case, it seems that the Australian Government has caught wind of the potential risks to “national interests” and intervened to prevent foreign interests from controlling such important natural resources.