Rare Earths Americas kicks off US IPO roadshow with $368 million valuation target

By Manya Saini

April 28 (Reuters) - Rare Earths Americas kicked off the roadshow for its U.S. initial public offering on Tuesday, aiming for a valuation of up to $368.4 million, as investor interest surges in critical minerals used in products from electric vehicles to iPhones.

Western countries are pushing for new critical mineral supply sources to reduce their reliance on China's dominance in extraction and processing.

Rare Earths Americas plans to sell roughly 2.78 million shares priced between $17 and $19 each to raise up to $52.8 million.

It is an exploration-stage company that is advancing a portfolio of critical minerals projects focused on high-grade heavy rare earth assets.

"With assets in the U.S. and Brazil, Rare Earths Americas is positioning itself within the broader push to diversify supply chains, as China still dominates the rare earth market," IPOX Research Associate Lukas Muehlbauer told Reuters.

Rare earths are a group of 17 elements, often used to make magnets, which are found in small but critical quantities in products ranging from household items to fighter jets such as the F-35.

In its IPO prospectus, Rare Earths Americas said long-term prospects for the elements remain strong, partly reflecting the U.S. government's view that critical minerals, including rare earths, are essential for national security and economic resilience.

It also cited policies to boost domestic production, including expedited permitting, easing regulatory bottlenecks, and providing capital and technical support.

The sector has also seen a surge in dealmaking in recent months. U.S.-based miner Critical Metals CRML.O signed a letter of intent this week to acquire all outstanding shares of European Lithium EUR.AX in a deal valued at about $835 million.

"As newly public companies often become acquisition targets, a potential M&A premium helps to support investor appetite for these listings," Muehlbauer said.

After the offering, Rare Earths Americas will trade on NYSE American, under the symbol "REA." Cantor and Stifel are the lead underwriters.