OKLAHOMA CITY: USA Rare Earth said Monday it has agreed to acquire Brazilian rare earths miner Serra Verde in a $2.8 billion cash-and-stock deal, a move aimed at reducing Western dependence on Chinese dominance of the global supply chain for critical minerals.
The Oklahoma-based company will pay $300 million in cash and $126.9 million in newly issued stock, with the transaction expected to close in the third quarter of 2026, subject to regulatory approvals and other closing conditions.
Rare earths — 17 elements with unique magnetic properties — are essential components in smartphones, electric vehicles, military equipment and clean energy technologies.
China produces nearly 70% of the world’s mined rare earths and almost 90% of refined rare earths, including material imported from other countries, giving Beijing significant leverage in the U.S.-China geopolitical rivalry.
“The world has become too dependent on a single source and it’s high time to break that dependency,” USA Rare Earth CEO Barbara Humpton said Monday on CNBC’s “Squawk Box.” She said the deal would provide “access to a producing mine that produces the four magnetic rare earths that are going to be serving our industry.”
The acquisition includes a 15-year offtake agreement with a special purpose vehicle backed by multiple U.S. government entities and private capital sources for 100% of Serra Verde’s production of four rare magnetic rare earths: neodymium, praseodymium, dysprosium and terbium — all critical for high-performance permanent magnets.
Serra Verde Group CEO Thras Moraitis said the U.S. government has been “very active” in encouraging upstream investment, particularly in creating floor prices for rare earths.
“Rare earths represent a strategic nexus where national and energy security, and technological supremacy, converge,” Moraitis said in a statement. “The Western rare earth sector stands at a critical inflection point, as governments and strategic industries urgently seek reliable sources of critical rare earths — particularly scarce heavy rare earths.”
Western officials have repeatedly warned that Beijing’s supply chain dominance poses a strategic challenge, especially as demand for critical minerals is expected to grow exponentially with the accelerating clean energy transition.
Shares of USA Rare Earth fell 3.4% in premarket trading Monday. The stock remains up about 68% year-to-date through Friday’s close.