Ann: Becoming a substantial holder , page-11

It looks like Arafura need the money for their Bankable Feasibility Study. According to Resource Capital Research update Oct 2011, they will also be doing a capital raising later this year (see extract below).

"Extended BFS. ARU has extended the BFS scope to further de-risk the project, simplify by-product
streams and potentially pare back opex and capex. It involves the operation of demonstration plants for
ore concentration and REO separation processes over the next 6-9 months, and will require ARU to raise
an additional A$50-60m to finalise the BFS, which is expected to be completed by 4Q12."

Obviously, decision made that the friendly position they held in NUP can be better spent on their own rare earths development.

I wouldn't read anything more into it that that.