Gina Rinehart Acquires Substantial Stake in Lynas Rare Earths

Gina Rinehart, Australia's richest person, becomes major shareholder in Lynas Rare Earths, fueling speculation of a potential merger with MP Materials to counter China's rare earths dominance.

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Geeta Pillai
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Gina Rinehart Acquires Substantial Stake in Lynas Rare Earths

Gina Rinehart Acquires Substantial Stake in Lynas Rare Earths

Gina Rinehart, Australia's richest person, has become a major shareholder in Lynas Rare Earths, the largest producer of rare earths outside of China. Rinehart's privately held Hancock Prospecting has acquired a 5.82% stake in Lynas, fueling speculation of potential sector consolidation.

Lynas and the next biggest Western rare earths miner, MP Materials, had earlier this year held merger talks, which were later ended. Analysts suggest that Rinehart's emergence as a significant shareholder in both Lynas and MP Materials could encourage a merger between the two companies, citing potential strategic and cost-saving synergies.

Rare earths are critical minerals vital for the energy transition and used in wind turbines, electric vehicles, and missiles. China currently dominates the global rare earths supply chain, and a merger between Lynas and MP Materials could create a scaled Western rare earths champion to counter China's dominance.

Lynas mines rare earths at its Mount Weld mine in Western Australia and is building processing facilities in the United States. The company's share price has fallen 15% in 2024, and Rinehart may have seen the company's shares as representing value at the current levels.

Rinehart is known for her aggressive acquisitions in the lithium sector and has now turned her attention to rare earths. Hancock Prospecting has also been acquiring stakes in other rare earth companies, including Brazilian Rare Earths and Arafura Rare Earths, indicating Rinehart's strategic interest in the broader rare earth industry.

The rare earths market has seen price volatility recently, with neodymium prices slumping by nearly three-quarters since early 2022. However, analysts believe the demand for rare earth elements will outstrip supply in 2026, potentially driving their prices higher as early as next year.

Rinehart's investment in Lynas adds to her portfolio of stakes in critical mineral producers. While her ultimate plans remain unclear, this latest acquisition could potentially lead to further deals in the rare earths industry as Rinehart positions herself to become a key player in a Western world response to China's dominance of the rare earth metals sector.

Key Takeaways

  • Gina Rinehart, Australia's richest, acquired 5.82% stake in Lynas Rare Earths.
  • Lynas and MP Materials held merger talks, now Rinehart may encourage a merger.
  • Rare earths are critical for energy transition, China dominates supply chain.
  • Rinehart also acquired stakes in other rare earth companies, indicating strategic interest.
  • Rare earths market faces potential supply shortage, Rinehart aims to counter China's dominance.