US Rare Earth Minerals Inc (OTCMKTS:USMN) reported that the management was astounded at the press release issued on August 28. The news release stated that Tesla Motors Inc (NASDAQ:TSLA) is building a battery factory known as GigaFactory in Nevada. It was stated as the $5 billion investment that plans to reduce battery costs by nearly 30% partly by including in-house material suppliers.
Further the PR mentioned that the automaker has finalized long-term supplier deals with North American firms Bacanora Minerals Ltd and US Rare, which produce lithium, the raw material utilized in batteries.
The management of US Rare Earth Minerals reported for the record, although company main product EXCELERITE has Lithium content, they are not currently involved in the mining of Lithium. At the same time, the company added that they are reviewing the options for same, but have not finalized any deals of any kind with Tesla.
US Rare Earth clarified that they have no role in the misleading PR and are not accountable for it. They want the investors to know that the management has stringent controls in place to see that no misleading information is disseminated.
US Rare Earth Minerals is involved in the distribution and sales of products derived from its mining operations in Nevada pertaining to certain natural rare earth minerals and natural mineral deposits. The products offered include agricultural products as well as natural minerals for animal consumption. The company has its headquarters in Reno, Nevada with executive set ups in Las Vegas, Nevada.
Following the clarification, the stock price of US Rare Earth Minerals plunged more than 87% on Monday and closed at $0.089. The news of no deal with the leading manufacturer resulted in disappointment among investors, which was evident in total traded share volume of over 1 million compared to average share volume of 52,514.