Key Takeaways:
The US is getting its first publicly traded pure-play rare earth recycling company — a bet that onshoring critical mineral supply chains can outpace traditional mining.
Hall Chadwick Acquisition Corp., a Nasdaq-listed special purpose acquisition company, agreed to merge with REEcycle Holdings Inc. in a deal valuing the combined entity at US$400 million, the companies said Monday. The transaction creates the only publicly listed US rare earth recycling platform at a time when Washington is racing to break China's near-total grip on the supply of materials essential to EVs, defense systems and clean energy infrastructure.
"The dependence of US defense and technology industries on Chinese rare earth processing is a vulnerability that must be addressed," said Alex Bono, chief executive officer of Hall Chadwick Acquisition Corp. "REEcycle has the technology, the team and the feedstock strategy to be a central part of the solution."
REEcycle recovers neodymium, praseodymium, dysprosium and terbium — the core constituents of high-performance permanent magnets — from end-of-life hard drives, decommissioned defense equipment, EV motors and industrial machinery. The company's hydrometallurgical process, developed at the University of Houston, selectively dissolves and separates rare earth elements from complex magnet alloys at yields and purity levels that meet commercial specifications, according to the company.
China controls an estimated 85 percent to 90 percent of global rare earth processing, a dependency the US Department of War and Department of Energy have flagged as a critical national security vulnerability. Demand for rare earth elements is forecast to nearly triple by 2035, driven by EV adoption, wind energy expansion and defense modernization, while Chinese-dominated supply is expected to fall materially short, according to McKinsey & Co. The global rare earth market was valued at roughly US$19 billion in 2025 and is projected to reach about US$36.7 billion by 2034, Grand Research Store data show.
Deal Structure and Capital Position
Under the terms of the business combination, REEcycle equity holders will receive consideration entirely in shares of the combined company's common stock, with an earnout of up to 5 million additional shares tied to achieving an annualized production run rate of 50 metric tonnes of mixed rare earth oxide. HCAC currently holds approximately US$207 million in trust, and the combined company is expected to have at least US$40 million in unrestricted cash at closing.
Shares held by HCAC's sponsor entity and REEcycle legacy shareholders will be locked up for six months post-listing, subject to early release conditions. The transaction requires approval from HCAC shareholders and effectiveness of a registration statement filed with the Securities and Exchange Commission.
Hall Chadwick is acting as exclusive corporate adviser and joint financial adviser to HCAC, with Cohen & Company Capital Markets serving as joint financial adviser and placement agent. Empire Capital Partners advised REEcycle. Duane Morris LLP is legal counsel to HCAC, and Perkins Coie LLP represents REEcycle.
Strategic Rationale and Path to Production
REEcycle's approach addresses a structural gap: the US currently has no meaningful domestic rare earth separation and refining capacity at commercial scale outside of Chinese-controlled entities or joint ventures. Recycling offers a faster and less capital-intensive alternative to mining virgin ore, the company argues, with each modular commercial plant estimated to cost about US$40 million. The near-term plan targets three to four facilities across the US, followed by expansion into Europe.
The company has already demonstrated credibility as a government partner, having been awarded US$5.1 million in non-dilutive funding from the Department of War, with US$4.3 million remaining and disbursed monthly against spend. A demonstration plant in Oklahoma, co-located at an existing industrial site, is designed to produce six to eight tonnes of rare earth oxide per year, validating the commercial-scale process. A final engineering study for the first commercial-scale facility, targeting 100 tonnes per annum by 2027, is being led by DRA Global with completion expected in the second quarter of 2026.
The combined company will be led by Mick McMullen as executive chairman. McMullen, an Australian-born geologist and mining executive, previously served as CEO of MAC Copper Ltd., which he built around the CSA copper mine acquired from Glencore for US$1.1 billion before selling to Harmony Gold Mining for US$1.03 billion in October 2025. He also led turnarounds at Detour Gold Corp. and Stillwater Mining Co., each culminating in multibillion-dollar acquisitions.
The transaction comes as the US government has committed billions of dollars through the Inflation Reduction Act, the CHIPS and Science Act and Department of Defense funding mechanisms to build out domestic critical mineral supply chains. REEcycle's closest public-company peers — MP Materials Corp. and USA Rare Earth Inc. — are focused on mining and magnet production rather than recycling, positioning the combined company as a distinct vehicle for investors seeking exposure to the circular economy of critical minerals.
This article is for informational purposes only and does not constitute investment advice.
