Reuters reported state-owned China Rare Earth Group is in talks to acquire Shenghe Resources, which holds about 3% of MP Materials. Shenghe denied its controlling shareholder planned a transfer; Reuters sources could not determine what would happen to Shenghe's foreign stakes.
Shenghe was also MP's exclusive offtake partner for rare-earth concentrate in China. MP stopped shipping concentrate there in April 2025 and terminated the agreement; MP has said neither Shenghe nor the Chinese government controls its operations.
The article says a change in Shenghe's control could prompt U.S. scrutiny because MP supplies materials used in defense applications, though Shenghe's 3% holding does not confer operational control over MP. The Pentagon invested $400 million in MP preferred equity and provided a 10-year NdPr price floor, long-term magnet purchase commitments and a $150 million loan; Apple committed $500 million to buy and develop U.S.-made magnets with MP.
