USA Rare Earth says that it's planning to acquire Brazilian rare earth miner Serra Verde for $2.8 billion, as the Oklahoma-based company looks to challenge China's status as the world's leading supplier.

According to an April 20 release, the deal would ensure that USA Rare Earth secures the only large-scale producer of vital heavy rare earth minerals (HREEs) outside of Asia. Serra Verde is also expected to represent more than half of all production of non-China HREE supplies by 2027.

“The world has become too dependent on a single source and it’s high time to break that dependency,” USA Rare Earth CEO Barbara Humpton told CNBC's Squawk Box on April 20.

HREEs are known to be scarcer and more expensive than their light rare earth mineral counterparts, and are used in high performance magnets found in advanced military technology. China holds a virtual monopoly on nearly all HREEs, producing anywhere between 85% and 99% of heavy rare earths depending on the exact minerals. However, substantial reserves of HREEs have recently been discovered in Vietnam and Brazil, bringing in significant foreign investments as companies continue to search for alternatives to China.

By acquiring Serra Verde, USA Rare Earth says that it will have the combined capability to expand production across the entire light and heavy rare earth supply chain, including mining, processing, separation, metallization and magnet making.

"We are advancing our goal of creating a fully integrated platform that will serve as a cornerstone of global rare earth supply security for decades to come," Humpton said.