Rinehart-backed Lynas Rare Earths looks to investors for $750m raise as US growth hits hurdle

Lynas Rare Earths has turned to private investors — including Gina Rinehart — for $750 million to refine more of the China-controlled commodity, as plans to launch in the US come unstuck.

There was no indication of government participation in the mammoth capital raise Lynas revealed to the market Thursday, but its chief executive hinted there were discussions with Australian, US and Japanese governments on “what it takes for the rare earths supply chain to flourish”.

It comes after Federal Resources Minister Madeleine King told the Diggers and Dealers forum earlier this month that the Albanese Government “certainly wouldn’t” rule out following the US by directly investing in an Australian-based producer of rare earths, or eventually setting a minimum price for offtake deals with local producers.

Chief executive Amanda Lacaze suggested Lynas had not been pursuing government debt — which is funding $1.2 billion of Iluka Resources’ refinery at Eneabba and a common method — but did not rule out that there had been conversations about setting a price floor in Australia.

“We are engaged with various governments, including the US, the Australian, the Japanese government, on what it takes for the rare earths industry and rare earths supply chains to flourish in the years to come,” she told analysts on Thursday.

“And one of the things that includes is a reliable floor price for NdPr, which has been set by the US government in the deal they’ve done with MP.”

How miners source funding for often expensive projects that produce commodities deemed critical to industrial growth and defence capabilities is an ongoing topic of debate in Australia.

The debate was fuelled further in July when the US government decided to go so far as taking a stake in private producer MP Materials, while also offering a $US110/kg price floor for rare earths.

But a disclosure on Thursday that Lynas’ proposed rare earths plant slated to be built in the US state of Texas “is uncertain”, has cast doubt on whether the WA-focused miner can establish a foothold in the US.

“We think that there is significant uncertainty that the Seadrift plant will proceed as has been conceived previously, but we are working very closely with the US government on what is the best outcome,” Ms Lacaze said.

The company is already due to receive about $US258 million ($389m) for the plant, but talks since the start of the year with the Trump administration have not yet yielded an outcome as to who would pick up the tab for additional costs associated with water permitting issues.

Lynas last month revealed it had inked a memorandum of understanding for a 3000-tonne capacity neodymium iron boron magnet factory with South Korea’s JS Link.

With no further concrete outcome in terms of government support, Lynas has offered new shares in the company to investors at $13.25 apiece to fund its growth. A follow-up share purchase plan of up to $75m would take the total raising, being led by investment bank Barrenjoey and Macquarie, to $825m.

Mrs Rinehart’s Hancock Prospecting owns more than 8 per cent of the listed business, and is understood to be fully participating in the placement.

The move to raise cash from the market capitalises on a doubling in Lynas’ share price over the past 12 months amid a newfound focus on the commodity — used in magnets — as western countries look to build up supply chains outside of China.

It comes after Ms Lacaze suggested Australian miners would benefit by partnering with Asian countries with strong manufacturing expertise.

Proceeds from the raising will give the company “firepower” to pursue its growth agenda through to 2030, Ms Lacaze said.

The call for cash came on the same day Lynas handed down 2025 full-year results that revealed its bottom line had slumped by $80m.

The decrease to an $8m profit from $84.5m in the year prior was largely due to depreciation on plant and equipment at its Kalgoorlie rare earths processing facility, which did not hit nameplate production as expected.

Revenue increased from $463.3m to $556.5m, as rare earths prices fetched $60.20/kg in the final quarter for FY25. This was the highest average selling price since in roughly three years.

The company ended the year with about $166.5m in the bank.