Lynas to Acquire Meteoric Resources in A$968 Million All-Share Deal

Deal Overview

Lynas Rare Earths and Meteoric Resources said on October 1, 2026 that they had entered into a binding Scheme Implementation Deed under which Lynas proposes to acquire all Meteoric shares through a court-approved scheme of arrangement. Consideration is entirely in new Lynas shares.

Caldeira, in the Brazilian state of Minas Gerais, is Meteoric’s flagship project. It is an ionic clay deposit, and its definitive feasibility study was released on July 31, 2026. Lynas mines rare earths at Mt Weld in Western Australia and processes them at Kalgoorlie and at its Lynas Malaysia plant in Kuantan. The companies describe Lynas as the only commercial producer of separated light and heavy rare earth oxides outside China.

The Meteoric board has unanimously recommended the scheme, in the absence of a superior proposal and subject to an independent expert concluding, and continuing to conclude, that it is in the best interests of Meteoric shareholders. Directors holding 2.6% of Meteoric’s ordinary shares intend to vote in favor on the same basis. Tolga Kumova, Meteoric’s largest shareholder with about 6.7% together with associated entities, has stated the same intention for shares held at the time of the meeting, while reserving the right to sell or otherwise deal in the shares before then.

Transaction Terms

The exchange ratio is fixed at 0.0207 new Lynas shares for each Meteoric share. Because the ratio is fixed, the value Meteoric holders receive moves with the Lynas share price until implementation. On implementation, Meteoric shareholders would own about 5.9% of Lynas on a fully diluted basis and existing Lynas shareholders about 94.1%.

The headline equity value of A$968 million uses Lynas’ 60-day volume-weighted average price of A$15.29 to September 30, 2026 and Meteoric’s fully diluted share count of 3,060,127,368. At Lynas’ last close of A$13.83 on the same date, the investor presentation puts the implied offer value at A$876 million.

All prices in the table are as of September 30, 2026, and each premium compares the two companies over the same period.

The deed contains exclusivity obligations, including “no shop, no talk” provisions, notification obligations and a right for Lynas to match any superior proposal. Break fees run in both directions: the deed sets the fee payable by Meteoric and the reverse fee payable by Lynas at A$8.8 million each, in the circumstances it specifies.

Meteoric’s options, performance rights and other rights to acquire shares will be dealt with under their terms and the deed so that, after implementation, they neither convert into Meteoric shares nor dilute Lynas’ ownership of Meteoric.

The Caldeira Project

Caldeira sits in Minas Gerais, 254 km from São Paulo and 350 km from the Port of Santos. Meteoric reports a Mineral Resource of 1,631 million tonnes at 2,317 ppm total rare earth oxides (TREO) across the Measured, Indicated and Inferred categories, and an Ore Reserve of 151 million tonnes at 3,524 ppm TREO. The companies call it the largest known ionic clay rare earth resource outside China reported under the JORC Code.

The definitive feasibility study released in July 2026 estimates a 23-year mine life based only on Ore Reserves. Its production target averages 12,500 tonnes of TREO a year over that life, including 3,862 tonnes of neodymium-praseodymium (NdPr) and 127 tonnes of dysprosium-terbium (DyTb). The study estimates life-of-mine average C1 cash costs of US$11.68 per kilogram of TREO and development capital of US$498 million, a Class 3 estimate with 10% contingency.

These are study estimates for a project that is not in production. The companies state that there is no certainty the production target or the forecast financial information will be achieved.

Meteoric holds a Preliminary Environmental License for the project and is targeting an Installation License in 2026. More than 80% of the tenure was not considered in the study.

Alongside the scheme, Meteoric amended its agreement with Togni S/A Materiais Refratários, which gives it the exclusive right to explore, develop and mine rare earths at Caldeira. Togni could previously terminate if extraction, processing and production had not begun by April 2031. That date moves to April 2033, with monthly payments of US$1.2 million due to Togni from April 2031 until operations start or April 2033, whichever comes first. Half of each payment is creditable against future participation payments.

Strategic Rationale

Lynas today draws on a single orebody, the hard-rock Mt Weld deposit. Caldeira would give it a second resource of a different geological type and add Brazil to its operations in Australia and Malaysia. On a pro forma arithmetic basis, the companies calculate that Caldeira raises Lynas’ Measured and Indicated TREO Mineral Resource by about 79%, from 2,316 thousand tonnes to 4,156 thousand tonnes of contained TREO, and its Ore Reserve by about 26%.

The transaction falls under the “add resource and scale” pillar of Lynas’ Towards 2030 strategy. Lynas says it expects the deal to be accretive to net asset value, Mineral Resources and Ore Reserves, and to future NdPr and DyTb feedstock capacity. In the companies’ comparison, which uses September 30, 2026 closing prices, Meteoric accounts for about 6% of pro forma market capitalization, 44% of contained TREO in combined Measured and Indicated Mineral Resources, and 21% of contained TREO in combined Ore Reserves.

“Lynas is very pleased with the potential to bring together the Caldeira deposit which is the largest known ionic clay rare earth Mineral Resource outside China reported in accordance with the JORC Code, and Lynas’ high grade Mt Weld deposit and leading rare earth operations. This will deliver on our Towards 2030 growth objective of adding resource and scale.”

— Prof John Humphrey, Board Chair, Lynas Rare Earths

Lynas sees two processing routes for Caldeira’s output. One is integration with its existing downstream operations in Malaysia. The other is new downstream processing in Brazil, which Lynas says it will study in line with the Brazilian government’s objectives for a domestic rare earth industry.

“Brazil is a well-established and supportive mining jurisdiction and its rare earth reserves are the largest outside China.”

— Prof John Humphrey, Board Chair, Lynas Rare Earths

For Meteoric shareholders, the case rests on the premium and on swapping a single-project developer for a stake in a producer with operating cash flow. The announcement cites Lynas’ A$1.2 billion of cash and short-term deposits as of June 30, 2026, and its project delivery record. Lynas intends to retain key Meteoric personnel and keep an in-country presence in Brazil.

“That discipline is why Caldeira stands where it does today: an orebody that is high grade, highly recoverable, low in capital intensity, low in operating cost, and highly scalable.”

— Dr Andrew Tunks, Executive Chair, Meteoric Resources

Interim Funding and Development Capital

Lynas has agreed to provide Meteoric with an unsecured loan facility of up to A$110 million to cover Caldeira development work, transaction and implementation costs and working capital while the scheme is in progress. The first tranche of A$35 million is to be advanced on execution of the deed. A second tranche of up to A$75 million becomes available if the deed is still in force six months after signing and its end date is extended.

The October 1 presentation sets interest at 10% a year, capitalized and payable at repayment. No repayment is required before implementation if the scheme is approved. If the deed is terminated following a superior proposal or a Meteoric breach, repayment is due within one month. The parties expect to enter definitive documentation for the second tranche shortly after signing, and further details are to be included in the scheme booklet.

The acquisition consideration is payable in shares, preserving cash that would otherwise be paid to Meteoric shareholders. The interim loan and transaction costs still require funding. Lynas says it expects capital expenditure to develop Caldeira to exceed US$500 million; the feasibility study’s initial estimate was US$498 million. The announcement states that production rates and costs remain subject to a final investment decision and market conditions.

Conditions and Timetable

The scheme is conditional on the independent expert’s conclusion, approval by Meteoric shareholders at the scheme meeting, court approval, applicable regulatory approvals, and no material adverse change or prescribed event affecting either company. Under the deed, Brazilian change-of-control approval must also be obtained, on terms reasonably acceptable to Lynas, if it becomes legally required before the second court hearing.

The companies say Law No. 15,506/2026, recently introduced in Brazil, requires approval for changes in control of certain companies holding mining rights over critical and strategic minerals, and name the approving body as the National Council for the Industrialization of Critical and Strategic Minerals. The presentation notes that aspects of the regime remain subject to implementation, and that the approval is not needed if it is determined under the agreed arrangements that the regime does not apply to the scheme. Tunks said in the announcement that Lynas had engaged directly with Brazil’s federal government and the development bank BNDES as part of the transaction.

Meteoric intends to send the scheme booklet to shareholders in December 2026. The scheme meeting is expected in January 2027. If shareholders and the court approve and any required Brazilian approval is obtained, implementation is expected by March 2027. The deed’s end date is six months after signing unless extended. The companies describe these dates as indicative.

Barrenjoey is financial adviser to Lynas, with Mallesons as legal adviser and BMA Advogados on Brazilian law. Meteoric is advised by Macquarie Capital, Allens and Pinheiro Neto Advogados.