Rare Earth Producer MP Materials Merges With Blank Check Company

MP Materials will merge with Fortress Value Acquisition, which was formed by Fortress Investment Group executives.
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MP Materials, a rare-earth minerals producer, announced Wednesday that it will merge with blank check company Fortress Value Acquisition (FVAC) to go public.

That has become a popular method for companies looking for an efficient way to get capital and get listed on a stock exchange.

The new company will be named MP Materials and will remain NYSE‐listed under the new ticker symbol "MP." Fortress Value Acquisition was formed in April by executives at Fortress Investment Group.

Under the deal, MP Materials will receive $500 million in cash and will garner a valuation of about $1.5 billion.

Hedge fund JHL Capital Group QVT Financial, which controls MP Materials, will roll over its equity stake into the merged company.

MP Materials produces rare earth materials used in electric cars, wind turbines, defense systems and other technologies.

“We believe MP Materials is a compelling opportunity to invest in an irreplaceable, world‐class asset at a point in time when demand from electric vehicles, wind turbines, and other technologies is hitting an inflection point,” said Drew McKnight, CEO of FVAC.

“The need to find a reliable and resilient source for rare earths is crucial for the U.S. and global supply chain.”

James Litinsky, who will become CEO of MP Materials, said, “This business combination and becoming a public company is a key milestone in MP Materials’ mission to restore the full rare earth supply chain to the U.S.”

Fortress Value recently traded at $11.23, up 12.35%. The stock has risen 12% since it began trading in June.