American Resources Corporation ( AREC ) saw its shares climb 3.18% to $5.17 in after-hours trading on Wednesday after the company announced a private placement deal.

Check out the current price of AREC stock here. 

AREC closed regular trading down 26.43% at $5.01 on Wednesday, according to Benzinga Pro data.

Private Placement Terms

The Indiana-based raw materials supplier signed a securities purchase agreement to sell 7,843,138 shares of Class A common stock or pre-funded warrants at $5.10 per share, according to the company's Wednesday press release.

Maxim Group LLC is acting as the sole placement agent.

Deal Structure And Timeline

American Resources ( AREC ) expects to raise about $40 million in gross proceeds before subtracting placement agent fees and other offering costs.

The offering is expected to close on Oct. 16, pending the usual closing conditions.

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Registration Requirements

The securities are being sold under Section 4(a)(2) of the Securities Act of 1933 and Regulation D.

American Resources ( AREC ) has agreed to file a registration statement with the Securities and Exchange Commission (SEC) to allow resale of the securities.

Sector Context

The placement comes as rare earth stocks attract investor interest, with CNBC's Jim Cramer describing the sector as "on fire" amid ongoing concerns over critical mineral supply chains.

JPMorgan Chase & Co. ( JPM ) also announced a $1.5 trillion initiative focused on critical minerals, amplifying sector momentum.

Stock Performance

The rare earth and critical minerals producer has gained 391.18% over the past year, hitting a 12-month high of $6.81 on Tuesday.

AREC has traded between $0.38 and $7.11 over the past year and currently holds a market capitalization of $423.89 million. The stock's average daily trading volume is 6.95 million shares.

With momentum in the 98th percentile, Benzinga's Edge Stock Rankings show that AREC is exhibiting a strong upward price trend across all time frames. Here’s how the stock performs across other key metrics.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.