New Delhi: Australia has reportedly rejected a bid by China-linked firm Austroid Corporation to acquire struggling lithium miner Alita Resources Ltd.
According to reports, the decision was announced by the Foreign Investment Review Board (FIRB) Spokesman for Treasurer Jim Chalmers Friday,
This is the second time this year that the FIRB has barred a Chinese company from investing in Australia’s vital mineral sector. In February, the FIRB reportedly blocked Yuxiao Fund, a Chinese investor and the largest shareholder of rare earth miner Northern Minerals, from increasing its stake, citing national interest concerns.
The move comes amid rising tensions between Australia and China over trade and security issues. Last week, Australian Foreign Affairs Minister Penny Wong met with Chinese foreign affairs chief Wang Yi, who reportedly urged Australia to provide a “fair, equitable and non-discriminatory” environment for Chinese businesses.
The injunction prevents Austeroid Corporation from acquiring an additional 90.10 percent of lithium miner Alita Resources, which would have increased its ownership to 100 percent. Alita Resources owns the Bald Hill lithium and tantalum mine in Western Australia, which it reportedly exports to China.
Austeroid Corporation director Mike Qu is the son of Chinese businessman Qu Wenbin, who owns a significant stake in Sichuan Western Resource, a maker of lithium batteries.
Qu also served as a director of China Hydrogen Energy Limited (CHEL), a Cayman Islands-based business that failed to acquire Alita in 2019 after failing to obtain FIRB permission.
Meanwhile, Austere Corporation said it was “stunned and disappointed” by the Australian government’s decision and warned it could have negative consequences on its Bald Hill mine operations.
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Australia’s Lithium Reserves
Australia is reportedly the world’s largest supplier of lithium and other important minerals such as rare earths, which are used in electric vehicles and defense equipment. He wants to boost trade with the US and its allies as part of a global effort to reduce dependence on China for these strategic resources.
Bald Hill Lithium and Tantalum Mine , a mine situated about 60 km south east of Kambalda, Western Australia , It was jointly owned by Alliance Mineral Assets and Tawana Resources. After their merger in 2018, the name was changed to Alita Resources.
The mine has estimated reserves of 11.3 million tonnes of lithium ore and 2 million tonnes of tantalum ore. According to west australian, a local daily newspaper, With Austroid’s bid being rejected, the mine could soon be put up for sale.
In a speech last year, Chalmers said Australia would become more selective about who it allows to invest in the critical minerals industry.
The move is significant as China reportedly dominates critical mineral processing, is responsible for more than 70 percent of global rare earth production and holds large investments in lithium and other mining and processing operations in Australia, Africa and South America.
Last month, Resources Minister Madeleine King reportedly said in an interview that Australia’s critical minerals strategy aims to ensure Chinese investment in the region is assessed “strategically” as the two countries compete in lithium refining.
(Editing by Richa Mishra)
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