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MP Materials and Lynas explore merger amid rare earth market turmoil—report

MP Materials (NYSE: MP) and Lynas Rare Earths (OTCPK: LYSCF; OTCPK: LYSDY) could be considering a merger, the Australian Financial Review reported Friday.

The publication suggests that the two companies may be in talks to merge, potentially forming the world’s largest non-Chinese producers of rare earths.

Both Lynas, with a mine in Western Australia and a plant in Malaysia, and MP, with operations in California’s Mountain Pass, have faced challenges due to plummeting rare earth prices.

Over the past year, MP shares have plummeted by over 50%, while Lynas shares have declined by approximately 40%.

China’s recent ban on the export of rare earth extraction and separation technologies aims to safeguard its market dominance amid speculation about China cutting off supply amid deteriorating US relations.

Last year, Lynas Managing Director Amanda Lacaze told the Australian Financial Review the company consistently receives merger and acquisition proposals. She reportedly emphasized the need for a source of heavy rare earths to complement its Australian operations and fulfill commitments to the US Department of Defense. The latter is funding a Lynas downstream processing plant in Texas.

MP Materials also has backing from the Pentagon, including a contract to boost heavy rare earths supply.

Source: MINING.COM – Read More