Overview
- USA Rare Earth entered a non-binding letter of intent with the Commerce Department for up to $1.6 billion, combining a $1.3 billion senior secured loan with $277 million in federal funding.
- The proposal includes issuing 16.1 million shares and roughly 17.6 million warrants to the government, equating to an estimated 10% ownership stake on a fully diluted basis.
- A separate $1.5 billion private placement runs alongside the CHIPS-linked offer, bringing prospective capital to about $3.1 billion to advance a mine-to-magnet supply chain.
- Disbursements would occur in phases tied to project milestones and final documentation, with USA Rare Earth still pre-revenue and projecting significant additional capex needs.
- Company plans target magnet output from Stillwater, Oklahoma in 2026 and Round Top mine production in Texas in 2028, as shares rallied and analysts raised price targets following the news.