Trump Administration Reportedly Set to Take $1.6B Stake in USA Rare Earth

The Trump administration is preparing to make its largest investment yet in the U.S. rare earth sector, with plans to acquire a stake in USA Rare Earth Inc. (NASDAQ: USAR) in a deal valued at roughly $1.6 billion, according to a report from the Financial Times.

Under the reported terms, the U.S. government would take a 10% equity position in the Oklahoma-based miner, which controls domestic deposits of heavy rare earth elements — materials viewed as increasingly strategic for defense systems, electronics, and advanced manufacturing. The investment is expected to be announced as soon as Monday, alongside a separate $1 billion private financing package, according to the report.

As part of the transaction, the government would receive 16.1 million shares of USA Rare Earth and warrants for an additional 17.6 million shares, priced at $17.17 per share, the report said. In addition to the equity stake, USA Rare Earth is also set to receive $1.3 billion in senior secured debt financing from the government, funded through a finance facility connected to the CHIPS and Science Act of 2022. A Commerce Department official confirmed the transaction was completed directly with the company, according to the report.

USA Rare Earth, which the report valued at roughly $3.7 billion, is developing a major mining project in Sierra Blanca, Texas, and is also planning a magnet production facility in Stillwater, Oklahoma.

The reported deal reflects growing coordination between the Commerce Department and the Defense Department to accelerate domestic supply chains for rare earths, a category where the U.S. has long been reliant on foreign production and processing.The investment fits into the Trump administration’s broader strategy of taking direct stakes in companies tied to national security priorities, including supply chains for minerals and semiconductors.

The administration has previously acquired stakes in other major firms, including a 10% stake in Intel (NASDAQ: INTC) and a 15% stake in MP Materials (NYSE: MP), as Washington continues to target reduced dependence on overseas suppliers, particularly China, for strategically important materials.

In August 2025, the administration also converted CHIPS Act grants into a $5.7 billion equity position in Intel, according to the report. Overall, the administration’s investments across sectors including steel, minerals, nuclear energy, and semiconductors have totaled more than $10 billion.

About USA Rare Earth

USA Rare Earth Inc. (NASDAQ: USAR) is a U.S.-based rare earth mining and processing company focused on developing domestic sources of heavy rare earth elements. The company is advancing a mining project in Sierra Blanca, Texas, and plans to build a magnet manufacturing facility in Stillwater, Oklahoma, supporting efforts to expand American supply chains for critical minerals used in defense, industrial, and technology applications.

At the time of publishing, Stocks.News holds positions in Intel as mentioned in the article.