USA Rare Earth has agreed to buy Brazil’s Serra Verde Group, a rare‑earth mine and processing plant, in a cash‑and‑stock deal worth $2.8 billion. The transaction will see the company pay $300 million in cash plus 126.8 million shares of its own common stock. The deal is slated to close in the third quarter ahead of the deadline.

This acquisition deepens USA Rare Earth’s mine‑to‑magnets supply chain, a strategic priority amid escalating U.S.–China tensions over critical minerals. By owning Serra Verde’s extraction and processing assets, the company can secure a steady flow of rare earths needed for high‑tech magnets used in electric vehicles and defense systems. This move also reduces reliance on foreign suppliers and aligns with national security objectives.

The deal values Serra Verde at roughly $2.8 billion, with cash and equity components reflecting a balanced approach to funding. The 126.8 million shares represent a significant equity stake, potentially diluting existing shareholders but offering long‑term upside if the Brazilian operation scales. If the extraction volumes meet projected targets, the company could capture higher margins and strengthen its position as a preferred supplier for critical technology manufacturers.

Regulators will monitor the transaction for antitrust and foreign investment concerns, given Brazil’s strategic importance in rare‑earth supply. Investors will assess how the deal impacts cash flow and earnings in the coming fiscal year, as the company integrates Serra Verde’s operations into its global network.