Latest news with #James Litinsky
Yahoo
4 days ago
- Business
- Yahoo
MP Materials and DoD to expand US rare earth magnet supply chain
US-based rare earth producer MP Materials has entered a public-private partnership with the US Department of Defense (DoD) to advance the domestic rare earth magnet supply chain and lessen reliance on foreign sources. The US is almost entirely dependent on imports for rare earth magnet components. The new strategic partnership aims to stimulate domestic production, bolster industrial resilience and secure essential supply chains for industries poised for growth and future dual-use technologies. The collaboration includes a multibillion-dollar investment package and long-term commitments from the DoD for the construction of MP Materials' second domestic magnet manufacturing facility, known as the 10X Facility. The 10X Facility, whose location is yet to be determined, will serve both defence and commercial clients. With an estimated manufacturing capacity of 10,000 tonnes (t), the facility is expected to begin commissioning in 2028. MP Materials also plans to enhance its heavy rare earth separation capabilities at its Mountain Pass facility in California, where high-purity rare earth materials are extracted, separated and refined at a single site. The company is also commissioning a magnetics facility in Texas, named Independence, which will anchor its downstream capabilities. MP Materials founder, chairman and CEO James Litinsky stated: 'This initiative marks a decisive action by the Trump administration to accelerate American supply chain independence. 'We are proud to enter into this transformational public-private partnership and are deeply grateful to President Trump, our partners at the Pentagon and our employees, customers and stakeholders for their unwavering support and dedication.' Under the partnership, the DoD has committed to a ten-year price floor of $110 per kg for MP Materials' neodymium-praseodymium (NdPr) products, ensuring stable cash flow and protection from market volatility. The DoD has also guaranteed to purchase all magnets produced at the 10X Facility for ten years post-construction. To support the development of the 10X Facility, MP Materials has secured a commitment letter for $1bn in financing from JPMorgan Chase Funding and Goldman Sachs Bank. The company also expects to receive a $150m loan within 30 days from the DoD for expanding heavy rare earth separation at Mountain Pass. The DoD will purchase $400m of a new series of convertible preferred stock in MP Materials, with the potential to become the company's largest shareholder. This investment will be used to expand rare earths separation, processing and magnet production capacities. In May 2025, MP Materials signed a memorandum of understanding (MOU) with the Saudi Arabian Mining Company (Maaden) to create a fully integrated, end-to-end rare earth supply chain within Saudi Arabia. "MP Materials and DoD to expand US rare earth magnet supply chain" was originally created and published by Mining Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Fast Company
6 days ago
- Business
- Fast Company
MP Materials' stock surged more than 50% Thursday—here's why
On Thursday, the United States Department of Defense (DOD) entered a major deal with MP Materials. The DOD agreed to buy $400 million of MP Materials newly created preferred shares stock. The move will make the U.S. military the company's largest stakeholder. In the hours after the deal, the company's stock surged more than 50%. MP Materials owns and operates the only operational rare earth mine in the U.S., located in Mountain Pass, California. It is the world's second-largest rare earth mine (the largest is in China). The purchase is part of a major effort to reduce foreign dependence on rare earths, a group of 17 chemical elements found within the earth's crust, which are necessary in creating magnets that are essential in military weapons systems. The company says the DOD's investment will allow for a major expansion of its operations, announcing that it will use the funds to construct the 10X Facility, its second domestic magnet manufacturing facility, at a location that is yet to be chosen. The company estimated that, upon completion, its total U.S. rare earth magnet manufacturing capacity will reach 10,000 metric tons. 'This initiative marks a decisive action by the Trump administration to accelerate American supply chain independence,' said James Litinsky, founder, chairman, and CEO of MP Materials in a press release. 'We are proud to enter into this transformational public-private partnership and are deeply grateful to President Trump, our partners at the Pentagon, and our employees, customers and stakeholders for their unwavering support and dedication.' The preferred shares bought by the DOD can be converted into common stock, the press release explained. The deal also includes a warrant convertible at $30.03 a share for 10 years, allowing the U.S. to purchase additional common stock. Under the deal, the U.S. government is committed to a 10-year agreement in which it will buy MP Materials for a minimum price of $110 per kg for its neodymium and praseodymium output. Once the 10X Facility is complete, it has agreed that 'all magnets produced at the 10X Facility will be purchased by defense and commercial customers with shared upside,' per the press release. MP Materials said it has obtained a commitment letter from JPMorgan Chase Funding Inc. and Goldman Sachs Bank USA, which will provide $1B in financing the 10X Facility. It also said it expects a $150 million loan from the DOD within 30 days. The DOD has been consistently working to ensure access to rare earth materials in recent years. Since 2020, it has spent more than $439 million on establishing supply chains for the materials in an effort to move away from relying on shipments from overseas. 'DOD's strategic investments are building capability at multiple stages of the rare earth supply chain and will provide a clear signal to private capital that the time is right to build additional resiliency,' Danielle Miller, acting deputy assistant secretary of defense for industrial base resilience, said last year. Miller continued, 'We are on track to meet our goal of a sustainable, mine-to-magnet supply chain capable of supporting all U.S. defense requirements by 2027.' The sale comes as concerns around China's control over the industry have surged. Previously, Shenghe Resources, which is partly owned by the Chinese government, was MP Materials' the sole customer. However, the company said earlier this year that due to China's 125% tariffs (put into place after Trump's tariffs on Chinese goods) it would no longer send materials to China. 'Selling our valuable critical materials under 125% tariffs is neither commercially rational nor aligned with America's national interest,' MP Materials said in a statement at the time. The DOD's new investment, which represents about a 15% stake in the company, is scheduled to close on July 11, 2025.
Yahoo
6 days ago
- Business
- Yahoo
MP Materials partners with Department of Defense to boost US rare earth magnet supply, shares soar
(Reuters) -MP Materials said on Thursday it has entered into a public-private partnership with the U.S. Department of Defense to build-out domestic rare earth magnet supply chain and reduce foreign dependency, sending shares up 30% in premarket trading. The company will construct its second magnet manufacturing facility in the U.S., the '10X Facility', to serve defense and commercial customers. Rare earths are a group of 17 metals used to make magnets that turn power into motion for electric vehicles, in cell phones, and other electronics. China is the world's largest producer and earlier halted exports to counter U.S. moves to levy punishing tariffs on it. MP Materials expects to add additional heavy rare earth separation capabilities at its California-based Mountain Pass facility. "This initiative marks a decisive action by the Trump administration to accelerate American supply chain independence," said its CEO James Litinsky. The facility is expected to be commissioned in 2028, the company added. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
