On 15 May, 2025, Shenghe Resources (Shenghe), through its subsidiary Ganzhou Chenguang Rare Earths New Material, announced it had entered into a binding agreement to fully acquire Australian-based Peak Rare Earths in a deal valued at A$158M (US$100M).

This deal follows a non-binding term sheet from July 2024, which proposed a 50% stake in Peak’s Ngualla Rare Earth Project in Tanzania, covering integrated investment, funding, and development and an existing 100% offtake agreement for the concentrate produced at Ngualla.

Shenghe is already the largest shareholder of Peak, holding a 19.9% stake and possessing 100% offtake rights for the rare earth concentrate produced from Ngualla. Under the new agreement, Shenghe will offer A$0.37 (US$0.24) per share, which is a 199% premium on Peak’s last closing price before the offer.

The deal has been recommended by Peak’s board, subject to not receiving any superior offers. The deal is  subject to several conditions, including due diligence, regulatory approvals from authorities in Australia, China, Tanzania and particularly from the Australian Foreign Investment Review Board (FIRB).

Shenghe possesses technical expertise across China’s rare earth supply chain. This experience will be leveraged to further develop and optimise the Ngualla project. Shenghe’s role will allow for the establishment of further value capture from the material within Tanzania through downstream processing, rather than exporting mineral concentrates. Through the acquisition of all shares, Shenghe would be able to leverage Chinese developed processing technologies at Ngualla, which may have been restricted previously due to the majority ownership of non-Chinese companies.

The purchase of Peak by Shenghe will take place against a geopolitical backdrop. MP materials (MP) was previously Shenghe’s major supplier of ex-China feedstock, but MP stated that this relationship had become untenable under 125% tariffs and that the deal was not  “aligned with America’s national interest”. In a statement, Shenghe stated that the suspension of shipments would not significantly affect production, due to a diversified supply base. Shenghe cited alternative supply from Sichuan alongside other countries and optionality around monazite feedstocks. Shenghe has also stated that the MP contract was still valid, with the offtake agreement renewed in January 2024.