China Rare Earth Group is in talks to acquire Shenghe Resources, owner of a 3% stake in U.S. rare earths company MP Materials 
MP, a move that would consolidate the Chinese government’s control over the sector and give the firm a stake in a U.S. rare earth play, Reuters reported Friday.
MP Materials’ MP largest shareholder is the U.S. Department of War Defense, which last year agreed to buy $400M of preferred stock plus warrants.
It is not clear how the prospect of a major Chinese state-owned rare earth firm sharing space on a shareholder registry with the U.S. Department of Defense could impact the deal.
MP MP has repeatedly said neither Shenghe nor the Chinese government has any control over its operations.
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