Regal joins Whitehaven Coal, Hancock, on Brazilian Rare Earths register

Fund manager Regal Investments has quietly accumulated a 5.3 per cent stake in ASX-listed Brazilian Rare Earths (ASX: BRE) after the miner's share price retreated over the second half of 2024. 

Regal joins Whitehaven Coal and Gina Rhinehart's Hancock Prospecting as big hitters on the register of the ASX junior considered a takeover target given its high-grade rare earth projects are strategic assets to counter China's dominance of critical minerals supply chains.

Gina Rinehart's Hancock has been shopping for rare earth assets across the Americas and last April took a 5.3 per cent stake worth $212 million in US rare earths miner MP Materials.

Shares in NYSE-listed MP Materials have more than doubled in value over the past six months as part of a "Trump trade" that has pushed strategic US miners higher. 

Sources speculated MP Materials could harness its soaring share price and the strong US dollar to lob a cash and scrip offer for BRE, with the latter's market capitalisation retreating to $289 million on Tuesday at $2.16 per share. 

Industry roll-up

Last year, MP Materials held talks with ASX rare earths giant Lynas over a possible mega-merger of the two biggest Western players in the sector. 

Lynas also counts rare earths evangelist Hancock on its share register. 

It is considered another potential bidder for BRE given its high-grade Brazilian assets mean potentially low capex costs as miners need to move less tonnes of earth to produce more critical minerals. 

Last June, BRE raised $80 million at $3.30 per share and dilution from the deal likely leaves Whitehaven owning about 7 per cent of the miner, with Hancock at around 5 per cent. Regal Investments did not immediately respond to a request for comment on its 5.3 per cent stake.