The Trump administration is planning to invest $1.6 billion in USA Rare Earth Inc. (NASDAQ:USAR), marking its biggest investment in the sector.
Securing Essential Mineral Supplies
The U.S. government will acquire a 10% stake in the Oklahoma-based miner, which holds substantial U.S. deposits of heavy rare earths. This move is part of Washington’s strategy to secure essential mineral supplies, as reported by the Financial Times on Friday.
The investment, along with a $1 billion private financing deal, is anticipated to be announced on Monday. The government will receive 16.1 million shares and warrants for an additional 17.6 million shares at $17.17 each, according to the report.
Additionally, USA Rare Earth will gain $1.3 billion in senior secured debt financing from the government, sourced from a finance facility under the CHIPS and Science Act of 2022. A commerce department official confirmed the transaction was completed directly with the company.
USA Rare Earth, valued at $3.7 billion, is developing a significant mine in Sierra Blanca, Texas, and plans a magnet production facility in Stillwater, Oklahoma. The Commerce Department and defense department have collaborated to enhance domestic rare earth production.
This investment is part of a broader strategy by the Trump administration to secure critical supply chains for essential resources.
Trump Admin's Investments
The administration has previously acquired stakes in several companies, including a 10% stake in Intel Corp. (NASDAQ:INTC) and a 15% stake in MP Materials Corp. (NYSE:MP), as part of its national security strategy. These moves aim to reduce reliance on foreign nations, particularly China, for key resources.
In August 2025, the administration converted CHIPS Act grants into a $5.7 billion equity stake in Intel.
The administration’s investments, totaling over $10 billion, span sectors such as steel, minerals, nuclear energy, and semiconductors.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: PJ McDonnell via Shutterstock
