Top 3 SPAC Targets – Rare Earth Miners

There have been few buzzwords more common among the fresh set of new S-1s for new SPAC than “critical minerals”. This is because a mix of technology demand and trade restrictions have made these resources valuable in a way they had not been before, but also because there are so many private potential targets with holdings in the space.

The difficult side of the West’s “catch-up” on critical minerals, however, has been the fact that the infrastructure is not always fully present to exploit the resources that already exist in friendly territories. A large number of the companies that SPACs have targeted in this thesis in recent years have themselves been holders of exploitable territory of resources while still being years away from commercial operations.

That is not to say that the field is barren of commercialized targets, but, SPACs searching for an out-of-the-box ready target in this competitive arena do have fewer targets to choose from. That said, some companies stand out from the pack as ready for a SPAC transaction to the public markets.

Phoenix Tailings

Phoenix Tailings is perhaps the largest rare earth firms in the US that has not yet been taken public and it bears many of the qualities of the successful SPAC plays in this space.

The highest-performing mining de-SPAC at the moment is USA Rare Earth (NASDAQ:USAR), which last closed above $18 and has made a number of moves since its listing to expand its position in its industry. USA Rare Earth has anchored its business around its Round Top deposit in Texas but has made a number of acquisitions that provide horizontal synergies in its space.

Phoenix Tailings is in a strong position to follow this act as it has built its position as a Top 10 refiner of rare earth materials without having the capex-heavy responsibilities of being a mine operator. It instead sources its materials from industrial waste streams and both purifies them with its own infrastructure and sells them on through its commodities trading network.

This may limit some of its equity valuation, but also puts it in line to receive more attention from both sustainability-focused capital and suppliers seeking to clean their own environmental impact.

It oversubscribed a $116 million Series B in February, which more than doubled its $40 million target, showing that investors are plenty eager to jump in on its growth story. Phoenix Co-Founder and CEO Nicholas Myers noted that the company is planning to “massively scale production” in the coming quarters and both sides could benefit from retail investors gaining the opportunity to jump in on that process.

Lynas Rare Earths

Lynas Rare Earths is also actively moving resources, specifically the neodymium and praseodymium (NdPr) that USA Rare Earth specializes in for its contracts in device batteries as well as lanthanum, cerium and samarium oxide. Given the long production tail for these types of assets, it helps that Lynas started in 1966.

It is also among the few companies to have built a full value chain for its resources outside of China as it separates its resources from its Mt. Weld mine in Western Australia at processing facilities in that country as well as Malaysia. In its last reported quarter, it produced 3,481 tons of rare earth materials, about half of which were NdPr resources and it generated A$289 million ($205 milliion) in gross revenue.

The company has been listed on the Australian stock exchange since the 1980’s, but it bears a number of qualities that could see it get much more attention should it center itself more actively on the US market. With a market cap of around $11 billion, the company could quickly gain a cash infusion as an entrant in lists of US-listed companies of its size that broad index and mutual funds buy into, and a number of things could boost its buzz further.

For instance, the company has received US government funding since 2020 and it would in theory be a candidate to join the growing list of companies that the US Department of Commerce has sought to gain equity stakes in as a part of a strategy that has included chipmakers and critical mineral miners like USA Rare Earth. In fact, Lynas has been seeking to break ground on a processing plant location in Texas with support from the US Department of Defense since at least 2023.

All of these factors would make a US float worth the transaction fees for Lynas and the right SPAC team could also potentially bring more growth capital and strategic ties to the US market as well.

Aclara Resources

Another US-directed flow of rare earths is growing in South America.

USA Rare Earth has come up a number of times in this column, not only because it is the star of this particular SPAC play, but because it has made good use of its time as a public company in the short 17 months since combining with Inflection Point II in March 2025. The company already announced plans in April to acquire South America’s only operating rare earth producer, Serra Verde, for about $2.8 billion.

If the continent’s remaining supply is to remain independently owned as these targets are gobbled up, it is likely to be under the umbrella of Aclara Resources.

Aclara holds rare earth assets in Chile, Brazil and the US and is the only other South American player to have its own proprietary processing capacity. It plans to open a separation facility in Louisiana next year that it believes will pay back its $470 million investment in a little over three years. This facility is expected to process about 1,131 tons of NdPr annually as well as dysprosium (Dy) and terbium (Tb) in enough amounts to supply up to 75% of the US EV production demand.

The resources feeding into this facility are slated to come from the company’s Penco project in Chile and its Garina project in Brazil. These projects are themselves at something of an inflection point as the Penco mine cleared its final environmental hurdle in June and the company’s broader operations have been shortlisted for US federal funding.

All of these factors present a unique time for all sides to cash in. Aclara currently trades at a market cap of about $674 million on the Toronto Stock Exchange, but US listing could see it valued significantly higher with an opportunity for a broader pool of retail investors to get involved before some near-term milestones like the opening of its Louisiana processing plant and the big next steps in its South American mines.

The company could also be a strong platform for consolidating resources in that geography while most assets remain at the early stage. One of the other largest estimated deposits on the continent is currently held by Litica Resources, which was itself just separated from its oil & gas-focused parent company PlusPetrol, in a move that could foreshadow its own strategic disposal.