USA Rare Earth Shares Soar 20% as US Government Acquires Stake

• USA Rare Earth shares surged over 20% after the US Department of Commerce announced an equity stake.
• The Department of Commerce will provide a $1.3 billion loan and $277 million in federal funding.
• In exchange, USA Rare Earth will issue 16.1 million common shares and 17.6 million warrants to the Department of Commerce.
• The US government's stake could range from 8% to 16% if all warrants are exercised.
• The company also raised $1.5 billion from private investors to develop a magnet manufacturing plant in Oklahoma and a mine in Texas, aiming to reduce dependence on China for rare earth minerals.

Why It Matters: US government investment in USA Rare Earth aims to boost domestic rare earth production and reduce reliance on China.