(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)
By Jonathan Guilford
NEW YORK, April 21 (Reuters Breakingviews) - USA Rare Earth is paying $3 bln to buy Brazil’s Serra Verde to complete an excavation, refining and stamping pipeline for metal-attracting elements outside China. A $250 mln EBITDA deal-related uplift sounds tantalizing. There’s also scarcity value in government-backed customers.
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<h3>CONTEXT NEWS</h3>
USA Rare Earth said on April 20 that it had agreed to buy Brazilian rare-earths miner Serra Verde in a cash-and-stock deal valued at $2.8 billion, based on the buyer’s undisturbed share price.
The transaction caps a string of acquisitions for USA Rare Earth, including British metal and alloys producer Less Common Metals and a stake in French processing firm Carester.
Serra Verde has secured a 15-year offtake agreement with a special purpose vehicle capitalized by U.S. government agencies and private sources, which has agreed to set a price floor for 100% of its supply of four magnetic rare earth elements.
Moelis is advising USA Rare Earth and Goldman Sachs is advising Serra Verde. (Editing by Jeffrey Goldfarb; Production by Maya Nandhini)

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