Gina Rinehart’s Hancock Prospecting grabs 5.8 per cent stake in Lynas Rare Earths

Australia’s richest person has set the stage for reinvigorated merger talks between Lynas Rare Earths and its US peer MP Materials.

On Tuesday, Gina Rinehart’s Hancock Prospecting splurged $40.2m on Lynas shares, a dramatic escalation of the investment vehicle’s recent multi-million dollar spending spree for the stock.

Hancock has now emerged as a major Lynas shareholder with 5.8 per cent slice of the Amanda Lacaze-led company.

At Lynas’ current market value Hancock’s holding is worth approximately $331.5 million.

Earlier this month, the mining billionaire took a piece of another rare earths giant, one which has been linked to a tie-up with Lynas.

According to Securities Exchange Commission filings Hancock bought about 8.8m shares of New York-listed MP Materials, constituting 5.3 per cent of its register.

At current prices that holding is worth about $222m.

In February, Lynas confirmed it had been mulling a potential merger with MP but says the talks ended without a formal proposal.

MP operates the massive Mountain Pass rare earth mine in California, which the company says is responsible for 15 per cent of the world’s rare earths consumption.

A deal between Lynas and the Las Vegas-headquartered MP would have brought together the two biggest rare earths miners outside of China, a country which has a stranglehold on the market for the precious materials that are used in industrial magnets, electric vehicles and defence technology.

Rare earth prices dropped 34 per cent in 2023, gutting the bottom line of majors like Lynas and MP, but this has not deterred Mrs Rinehart from strengthening her exposure to the sector.