Involved in the biosynthesis of the polyketide antibiotic aureothin (PubMed:14700630, PubMed:15038705). Catalyzes the oxidation of p-aminobenzoate (pABA) to p-nitrobenzoate (pNBA), an unusual polyketide synthase starter unit (PubMed:15038705, PubMed:16927313, PubMed:20798054, PubMed:18458342). Reaction mechanism involves the generation of a peroxodiiron(III/III) intermediate, which effects the initial oxidation of p-aminobenzoate to p-hydroxylaminobenzoate (Ar-NHOH) (PubMed:19731912, PubMed:20798054). Ar-NHOH is then probably directly converted to the fully oxidized p-nitrobenzoate via a four-electron N-oxidation, bypassing the formation of a nitroso compound (PubMed:20798054). 4-aminobenzoate + AH2 + 2 O2 = 4-nitrobenzoate + A + 2 H2O Contains a nonheme dinuclear iron cluster that stabilizes a peroxo intermediate (PubMed:16927313, PubMed:18458342, PubMed:19731912, PubMed:20798054). Was originally suggested to contain a binuclear manganese cluster or an heterodinuclear manganese/iron cluster (PubMed:17765264, PubMed:17718517). kcat is 6.21 min(-1) with p-aminobenzoate as substrate. Antibiotic biosynthesis. Homodimer. Deletion of the gene abolishes both N-oxidation activity and aureothin production. Belongs to the AurF N-oxygenase family.