The Trump administration has taken a $150 million equity position in Atlantic Alumina (ATALCO) to secure domestic supplies of alumina and the critical mineral gallium, intensifying the U.S. tech-and-defense race with China.
At a Glance
- The Defense Department buys preferred equity in ATALCO and expects more funding within 30 days
- Majority owner Pinnacle is injecting $300 million in private capital alongside the federal cash
- China now controls ~60 % of global alumina and >90 % of primary gallium
- Why it matters: The deal marks the latest example of Washington swapping subsidies for direct ownership in companies it deems strategic
The partnership, announced Tuesday, will expand ATALCO’s alumina refinery in Louisiana-operating since 1959-and create what the company calls the nation’s “first and only large-scale primary gallium production circuit.” Both materials are vital for semiconductors, next-generation energy hardware, and aerospace and defense systems.
Deal Structure
- $150 million in preferred equity from the Department of Defense
- Additional government funding expected within 30 days of closing
- Pinnacle, via subsidiary Concord Resources Holdings, commits $300 million in private capital
ATALCO projects output will rise to more than one million metric tons of alumina per year and up to 50 metric tons of gallium annually once upgrades are complete.
National-Security Rationale
“Aligning this essential public sector support with private sector investment will secure onshore supply of alumina and gallium, which are contested commodity market segments currently dominated by China,” ATALCO said in a press release.
China’s market grip-roughly 60 % of alumina and more than 90 % of primary gallium-has alarmed Pentagon planners who view the minerals as pivotal to weapons, satellites, and advanced chips.
Shift Toward Equity Stakes
The transaction continues the administration’s pivot from traditional subsidies to direct ownership. Last year the federal government acquired a 10 % stake in Intel after President Trump publicly pressured the chipmaker’s CEO over past China ties. Other recent equity plays include:
| Company / Project | Agency | Stake Size | Purpose |
|---|---|---|---|
| MP Materials | Defense | Undisclosed | Rare-earth supply |
| Trilogy Metals | Defense | Undisclosed | Copper-zinc for electronics |
| Lithium Americas | Energy | 5 % | Nevada lithium for EV batteries |
| U.S. Steel* | Treasury | Golden share | Veto power on key decisions |
*Via Nippon Steel takeover approval
Industry Reaction
Silicon Valley leaders predicted during the 2024 campaign that a second Trump term would favor business. Few anticipated the breadth of government equity positions now unfolding across critical-materials firms.
Key takeaways:
- The administration is using Defense Production Act authorities to take ownership, not just offer loans
- ATALCO’s Louisiana site becomes the flagship U.S. hub for alumina and gallium outside Chinese control
- Private investors must co-invest; Pinnacle’s $300 million matches the initial federal check two-to-one
What Comes Next
ATALCO says engineering work will begin immediately, aiming for full ramp-up within three years. Pentagon officials told News Of Fort Worth they will monitor output quarterly to ensure defense contractors receive priority supply once production starts.
