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Molycorp Seen Too Cheap as Rare Earth Lures Deal Talk: Real M&A

Molycorp Inc.’s gambit to supply Chinese-made magnets to carmakers in Japan is making it one of the mining industry’s most attractive takeover candidates.

The owner of the biggest U.S. rare-earth deposit, which rose 30 percent since agreeing in March to buy Neo Material Technologies Inc. to bolster its magnet-making ability, was still valued last week at 3.4 times next year’s earnings before interest, taxes, depreciation and amortization, according to data compiled by Bloomberg. That was cheaper than nine out of 10 metals and mining companies and a third less than the industry median, the data show.