Hall Chadwick merges with REEcycle to form first U.S.-listed rare earth recycler. Mick McMullen leads $40M modular plants targeting 3-4 sites. China dependence risk.
Hall Chadwick Acquisition Corp. (HCAC) announced a definitive business combination with REEcycle Holdings, creating what would be the first publicly listed pure-play rare earth recycling company in the United States. The combined entity, to be named REEcycle Inc., will list on Nasdaq after closing.
The deal targets a widely acknowledged national security gap: the U.S. sources 85–90% of its processed rare earth elements (REEs) from China and has no domestic separation capacity at commercial scale. REEcycle’s hydrometallurgical technology recovers neodymium, praseodymium, dysprosium, and terbium from end-of-life permanent magnets found in EV motors, decommissioned hard drives, and defense systems.
Demand for REEs is forecast to nearly triple by 2035, driven by EV adoption, wind energy buildout, and defense modernisation, according to a 2023 McKinsey & Company report. The global REE market was valued at approximately $19 billion in 2025 and is projected to reach $36.7 billion by 2034, per Grand Research Store (2025). China’s dominance in processing gives Beijing effective leverage over materials that power precision-guided munitions, radar arrays, and wind turbines.
Recycling offers a faster path to reducing that dependency than new mining projects, which typically take over a decade to reach production. REEcycle’s modular plant design is capital-efficient: each facility costs about $40 million to construct. The near-term business plan calls for three to four commercial plants across the United States, followed by expansion into Europe and other strategic markets.
The structural deficit in the global REE market is expected to widen through the next decade. New mining projects face long permitting timelines, high capital costs, and environmental scrutiny. Recycling avoids those bottlenecks. REEcycle’s process takes end-of-life NdFeB magnets – the core material in EV motors, wind turbine rotors, and industrial machinery – and recovers separated rare earth oxides and salts that can feed directly into magnet alloy manufacturing.
The addressable market for recycled rare earth content from U.S. end-of-life permanent magnets alone is estimated to reach hundreds of thousands of metric tons of NdFeB scrap per year by the early 2030s, as first-generation EVs and wind installations reach end-of-life. The U.S. federal government has committed billions through the Inflation Reduction Act, the CHIPS and Science Act, and Department of Defense programmes to build domestic critical mineral supply chains.
China controls roughly 85–90% of global rare earth processing capacity. The U.S. currently has no meaningful domestic separation and refining capability outside Chinese-controlled entities or joint ventures. The Department of War, the Department of Energy, and successive administrations have labelled this dependency a critical national security vulnerability. REEcycle’s technology is designed to close that gap using a hydrometallurgical process developed at the University of Houston, with patent protection and pilot-scale validation.
REEcycle’s core intellectual property originates from rigorous academic research at the University of Houston. The company’s hydrometallurgical technique selectively dissolves, separates, and recovers REEs from complex magnet alloys at high yield and purity. Key differentiators include the ability to process mixed magnet grades without pre-sorting and a closed-loop chemical system that reduces waste and operating costs.
The feedstock is abundant and growing. Each end-of-life EV motor, decommissioned hard drive array, and retired defense system contains REEs that are currently discarded or exported. REEcycle’s process recovers those materials domestically, creating a circular supply chain that is both sustainable and independent of Chinese supply.
Each commercial plant is designed to be modular and capital-efficient, with construction costs estimated at $40 million. The near-term target is three to four plants in the U.S., with a clear engineering pathway to commercial production. The financial model relies on low capital intensity compared to mining. Success, however, depends on securing feedstock contracts and achieving consistent throughput.
The transaction is structured as a merger of HCAC’s wholly owned subsidiary into REEcycle Holdings, with all consideration paid in shares of the combined company. REEcycle equityholders receive common stock plus an earnout of up to 5 million additional shares upon achievement of the commercial production milestone – a structure that aligns long-term incentives with value creation.
HCAC may also issue up to 6.125 million additional shares as it determines, subject to lockups. An additional 2.625 million shares are reserved for issuance after closing. If the commercial production milestone is reached, eligible recipients may receive an aggregate one-time issuance of 1.25 million deferred shares, split 70% to pre-closing designees and 30% to post-closing board designees.
Shares held by HCAC’s sponsor entity and REEcycle legacy shareholders are subject to a six-month lockup post-listing, with limited early release conditions. This lockup is a standard insider-alignment mechanism. It does not eliminate execution risk: SPACs that fail to reach commercial production often see insider shares become worthless.
Mick McMullen, REEcycle’s executive chairman since 2022, also serves as executive chair of Metals Acquisition Corp II, a NYSE-listed SPAC that recently raised $230 million in cash in trust. McMullen’s personal investment in REEcycle and his hands-on leadership signal conviction. Metals Acquisition Corp II (MTAL) carries an Alpha Score of 48 out of 100 (Mixed) on AlphaScala’s stock page, reflecting neutral sentiment among systematic models. The connection provides some capital-markets credibility. It does not guarantee REEcycle’s success.
McMullen is an Australian geologist and mining executive with more than 30 years of leadership experience. His track record includes:
McMullen’s pattern is consistent: acquire or build an asset, improve operations, and sell at a premium. For REEcycle, the path is different – the company is pre-revenue and depends on scaling a novel technology rather than improving an existing mine. The recycling thesis is untested at commercial scale in the U.S.
McMullen’s personal investment in REEcycle since 2022, combined with the earnout structure, ties his financial outcome directly to the commercial production milestone. That alignment is positive. It does not eliminate technology or market risk.
SPAC mergers with pre-revenue technology companies carry well-documented risks. For REEcycle, the key risks include:
The transaction is expected to close after HCAC shareholder approval and SEC effectiveness of the registration statement. HCAC will mail a definitive proxy statement to shareholders once the S-4 is declared effective. The timeline depends on SEC review speed and shareholder voting logistics.
For traders tracking the rare earth thematic, this deal offers a pure-play recycling exposure that did not previously exist in public markets. The AlphaScala commodities analysis section provides broader context on critical mineral supply chains. McMullen’s prior success at MAC Copper, now represented by MTAL stock page, provides a comparable case study in SPAC-led value creation. The recycling model carries fundamentally different risks than mining.
Investors should watch the S-4 filing for detailed financial projections and risk factors. Until commercial production is demonstrated, the stock trades on narrative and SPAC mechanics rather than earnings.
Practical rule: A SPAC with a pre-revenue technology company has a binary outcome – either the plant delivers, or the thesis collapses. The earnout structure forces management to deliver scale. Until the first ton of recycled rare earth oxide is shipped, the risk of failure exceeds the upside of success.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.