The Australian Securities Exchange said on Monday it will refuse an application by Moly Mines Ltd (MOL) to resume trading amid concerns over its major shareholder, Sichuan Hanlong Group, whose founder was executed in China last year.
Liu Han, who started Hanlong in 1997, was found guilty of a string of offences in China, including murder and arms smuggling, and was executed by firing squad in February 2015.
The ASX said it continued to have concerns over the control Hanlong wields over Moly. Hanlong owns 54 percent of Moly's stock.
"ASX has exercised its discretion to refuse the application of Moly Mines for re-admission to the ASX official list," it said in a statement emailed to Reuters.
"ASX is not satisfied that the Hanlong Group – owner of Moly's largest shareholder – will not be in a position to exercise some level of influence on the board and management of Moly."
Moly, which launched a revised takeover offer for Australian bauxite explorer Gulf Alumina on Nov. 8, has been searching for a vehicle to reactivate its ASX listing. It has until April next year to do so.
In 2014 Moly's shares were suspended from trading after the company was unable to identify a new project.
A Moly spokesman said the issues surrounding Hanlong's founder were historical matters and unrelated to Moly and are not relevant to its future.
He said the proposed Gulf Alumina transaction was an opportunity for all Moly shareholders to acquire an asset that would provide a pathway for relisting and generate returns.
"The past activities of certain directors have been dealt with," the spokesman said.
"Now put yourself in the shoes of the minority shareholders, who have been sitting there the last couple of years waiting for a reinvestment and then to be told you're going to get delisted early next year," he said.
The case against Liu was one of the most prominent involving a private businessman since Chinese President Xi Jinping took office two years ago and began a campaign against pervasive graft.
Liu, once ranked as China's 230th richest person, was tried in 2014, along with 36 others, accused of murder and running what state media called a "mafia-style" gang.
Gulf Alumina's board is recommending shareholders accept a counter offer by another Australian company Metro Mining (MMI), which already holds 39.3 percent of its stock, in the absence of a superior offer.
