Treasurer Jim Chalmers has used foreign investment powers to block a China-linked, USA-registered lithium products company from taking over the Australia-based mining company, Alita Resources.
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Lithium is a critical mineral for clean energy technologies, such as electric car batteries and solar panels.
Alita Resources, which operates a lithium mine at Bald Hill in Western Australia's Goldfields region, has had difficulties with debt since 2019.
The Treasurer has issued a foreign acquisitions and takeovers order to stop the Nevada-registered company, Austroid Corporation, from acquiring an additional 90.10 per cent interest in Alita, which would increase the company's interest to 100 per cent.
Dr Chalmers signed an order blocking the move on Thursday after the Foreign Investment Review Board recommended the application be turned down.
Under the move, Austroid Corporation is directed not to acquire any further interest in securities in Alita Resources, "if doing so will result in an increase in the proportion of interests it holds in Alita Resources exceeding 9.90 per cent".
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Austroid's Australian arm, Austroid Australia, is also directed not to acquire any interest in securities in Alita Resources.
Alita Resources went into administration in 2019. The Bald Hill mine is in operation.
Austroid's managing director, Mike Que, is also the director of China Hydrogen Energy Limited, a special purpose vehicle incorporated in the Cayman Islands.
"The Treasurer has issued a prohibition order consistent with advice from the Foreign Investment Review Board," a spokesperson for the Treasurer said.
"The government doesn't comment on the application of foreign investment screening arrangements."
Earlier this year, Dr Chalmers blocked a Chinese-linked investment fund, Yuxiao Fund, from increasing its stake in Australian rare earths producer Northern Minerals Limited from just under 10 per cent to 19.9 per cent.
According to the company, Northern Minerals Limited aims to be a principal supplier of ethically produced heavy rare earth elements, such as dysprosium, lutetium and terbium.
Rare earths are critical for the production of electric vehicles, energy efficient lighting and wind turbines.
Karen Barlow
Karen Barlow is ACM's Chief Political Correspondent. Working in the federal press gallery, she investigates and writes about federal politics and government. She has an interest in integrity, leadership and social equity. She has covered two Olympics and been to Antarctica twice. Contact her on karen.barlow@canberratimes.com.au
Karen Barlow is ACM's Chief Political Correspondent. Working in the federal press gallery, she investigates and writes about federal politics and government. She has an interest in integrity, leadership and social equity. She has covered two Olympics and been to Antarctica twice. Contact her on karen.barlow@canberratimes.com.au
