11/13/2025
American Activist Claims IperionX More Dud Than Critical Minerals Gem
Australian Financial Review (11/13/25) Wembridge, Mark
An ASX-listed critical minerals hopeful backed by the Trump administration has halted trading in its shares after an American activist investor alleged there were inaccuracies in its accounts and questioned whether it could commercialize its technology. North Carolina-based IperionX (IPX) is developing titanium extraction technology and has been among the winners of a White House push to secure domestic production of critical minerals, receiving $47 million from the Defense Department to accelerate production. The metal has many military uses, including in the construction of aircraft and warships. Despite operating in the United States, with a titanium, rare earths and zircon mineral sand project in Tennessee, IperionX is listed on the ASX and counts local fund managers Regal Partners and Pengana Capital among its largest shareholders. IperionX had been valued at more than $3 billion in September after the Defense backing was announced, but had slid below $2 billion before its shares entered a trading halt early on Thursday. The halt was put in place after Spruce Point Capital Management published a 93-page research report overnight, raising significant doubts about the company’s prospects. Spruce Point is a New York-headquartered hedge fund that specializes in short-selling, making money when shares fall. “To believe in the IperionX story, you must believe that a small group led by Australian mining executives discovered something that has been overlooked for years by everyone else in the global titanium industry,” Spruce Capital’s research report read, adding that the firm put the “downside risk” for the stock at between 70% and 95%. “We believe that investor expectations are too high, and it faces significant challenges in commercial efforts ... not be fully reflected in its valuation. We also express concerns with the accuracy of its financial reporting.” Spruce Point also said the company’s claims that its titanium extraction technology would revolutionize the industry were exaggerated. There was little “economic rationale for expanding capacity when it has few customer contracts and no historical revenue," the report noted. IperionX has said that its Hydrogen Assisted Metallothermic Reduction technology was more efficient than widely used methods because it is more energy-efficient and produces fewer carbon emissions. According to the company, IperionX is “set to be a leading American titanium metal and critical materials company – using patented titanium technologies to produce high-performance titanium alloys, from titanium minerals or scrap titanium, at lower energy, cost and carbon emissions." “The current management and board of IperionX is associated with one controversial individual and several public companies that have broadly failed to deliver lasting value for shareholders,” Spruce Point said. “Notably, there is a sharp overlap of IperionX executives with Piedmont ... which faced two short seller reports alleging it was a stock promotion connected to Levi Mochkin, who is permanently banned from financial services in Australia for alleged market rigging transactions.” The firm said it was not alleging IperionX had engaged in “any improper conduct, and investment in the same entity does not necessarily indicate an active business partnership or endorsement of Mr Mochkin’s past conduct." IperionX acknowledged its trading halt was because of the short-selling report, and said it was “forming an appropriate response." “The company is unable to discuss matters relating to the report until the compliance obligations have been satisfied,” the company told investors. IperionX chief executive, Taso Arima, also founded Piedmont Lithium, another ASX-listed producer which had projects in North America and Africa and was backed by the U.S. government. Piedmont was targeted by short sellers in 2023, accused of inflating its outlook. In August, Piedmont merged with Sayona Mining to form Elevra Lithium. At the time of the short seller accusation, Piedmont had a market capitalization of around $1.5 billion; Elevra was valued at $838 million during trade on Thursday. After touching a 12-month low of $2 in April, IperionX shares peaked above $9 in October, just before the U.S. President Donald Trump inked an $8.5 billion deal with Australia to promote rare earths and critical minerals production. In September, IperionX said some of the $47 million of U.S. government cash would be used to scale up its titanium manufacturing capacity at its hub in Virginia, with the aim of producing 1400 tonnes per year.
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