USA Rare Earth Completes $1.55 Billion SPV Funding for Serra Verde Offtake

USA Rare Earth, Inc. (NASDAQ:USAR) has completed the $1.55 billion capitalisation of a special purpose vehicle established to acquire 100% of Phase 1 rare earth production from Serra Verde Group, marking a key step towards completing its planned acquisition of the business.

The financing includes a $750 million commitment from the U.S. Department of War, which increased its participation by $250 million from the originally proposed $500 million.

The U.S. government has also agreed to a forward purchase arrangement under which it will acquire at least $300 million of rare earth products from the SPV over a five-year period.

Institutional Bank Commits Up to $500 Million

Further financial backing comes from an unnamed Tier-1 institutional bank, which has provided a commitment letter for a senior secured revolving credit facility of up to $500 million.

The facility is intended to provide working capital for the SPV as it purchases rare earth products from SV Management Switzerland.

Together, the government commitment and bank financing provide the SPV with $1.25 billion of funding capacity, alongside the $300 million forward purchase agreement.

Serra Verde Acquisition Moves Closer to Completion

USA Rare Earth announced a definitive agreement to acquire Serra Verde on April 20, 2026. Completion of the SPV capitalisation satisfies one of the conditions required for the merger to proceed.

NASDAQ:USAR shareholders are scheduled to vote on the proposed transaction at a special meeting on August 28, 2026.

Subject to shareholder approval and the satisfaction of the remaining closing conditions, USA Rare Earth expects to complete the acquisition shortly after the meeting.

The company previously filed its proxy statement with the U.S. Securities and Exchange Commission on July 24, 2026, in preparation for the shareholder vote.

Pela Ema Mine Would Expand USAR’s Rare Earth Footprint

Completion of the transaction would give USA Rare Earth ownership of the Pela Ema mine in Goiás, Brazil.

USAR describes Pela Ema as the only ionic clay rare earth mine currently in commercial production outside Asia, potentially giving the enlarged company a strategically important position within the global rare earth supply chain.

Following the acquisition, the combined business would have operations spanning the United States, United Kingdom and Brazil.

The Serra Verde production agreement would also provide the SPV with access to 100% of Phase 1 output, strengthening the group’s ability to supply rare earth materials into Western markets.

US Government Support Strengthens Rare Earth Strategy

The expanded U.S. government commitment highlights the strategic importance being placed on developing alternative rare earth supply chains outside Asia.

“We appreciate the strategic support and upsized funding commitment of the U.S. government and are proud to continue our strong partnership to build a secure and resilient rare earth supply chain,” said Michael Blitzer, Executive Chairman of USA Rare Earth.

For USA Rare Earth (NASDAQ:USAR), completing the $1.55 billion SPV capitalisation removes an important condition associated with the Serra Verde transaction and brings the company closer to establishing an integrated rare earth platform spanning production and operations across multiple international markets.

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