USA Rare Earth (USAR) Takes 12.5% Stake in French Rare Earth Processor Carester

TLDR

• USA Rare Earth signed a term sheet to acquire a ~12.5% stake in Carester, a French rare earth processing firm, for around €40 million.
• The deal gives USAR access to Carester’s oxide output and intellectual property, and a 15-year supply and offtake agreement.
• In return, Carester gets access to heavy rare earth feedstock from USAR’s Round Top mine in Texas.
• The partnership supports a rare earth processing hub in Lacq, France, including a 3,750 mtpa metal and alloy plant.
• USAR stock was down around 2.8% on Thursday; William Blair kept its Outperform rating following the announcement.

USA Rare Earth (USAR) announced a strategic investment in French rare earth processor Carester on April 9, 2026, adding a new chapter to its push for a rare earth supply chain built outside of China.

The company signed a term sheet to acquire approximately 12.5% of Carester SAS, alongside investment firm InfraVia, which will also take an equal stake. The deal is expected to close within one month, pending due diligence and definitive agreements.

USA Rare Earth Inc, USAR

The investment is anticipated to total around €40 million. It hands USAR oxide offtake rights, access to Carester’s engineering know-how and intellectual property, and ties it into Carester’s Lacq, France facility — currently under construction and on track to start operations in late 2026.

In exchange, USAR will supply Carester with heavy rare earth feedstock directly from its Round Top deposit in West Texas.

The Lacq site is being positioned as one of Europe’s most complete rare earth ecosystems. It will integrate processing, metal and alloy production, and magnet manufacturing. USAR’s LCM Europe unit has a planned 3,750 metric ton per year metal and alloy plant at the same location.

Why the Deal Matters

China controls an estimated 85% of global rare earth processing capacity. That concentration has become a pressure point in trade disputes, with Beijing using it as leverage against Western manufacturing interests.

Rare earth materials — used in everything from electric vehicles to fighter jets — are difficult to source and process outside China. USAR is one of several Western companies trying to change that.

The Carester deal strengthens USAR’s position as a midstream supplier in Europe. William Blair, which reiterated its Outperform rating on Thursday, said the investment helps USAR become a meaningful player in non-China global processing capacity and could open the door to further European government support.

Analysts overall maintain a Strong Buy consensus on the stock, with price targets ranging from $25 to $45. Roth/MKM recently trimmed its target to $25 from $35, while Canaccord cut to $29 from $33, both citing valuation adjustments rather than fundamental concerns.

Recent Company Milestones

USAR has been busy. In early 2026, it commissioned its commercial magnet production line in Stillwater, Oklahoma, with customer orders for sintered neodymium-iron-boron magnets expected to start shipping in Q2 2026.

The company also struck a mutual sales and distribution deal with Arnold Magnetic Technologies, and in January announced a nonbinding letter of intent with the Commerce Department for approximately $1.6 billion in financing.

Despite Thursday’s dip, USAR is still up 128% over the past 12 months. The stock was trading around $16.69 in early Thursday trading, down roughly 2.8%, broadly in line with weakness across the wider market.

The most recent analyst rating on the stock is a Hold with a $14.50 price target, though the broader analyst consensus sits more positively.

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