Pan American Silver to Acquire MAG Silver for $2.1 Billion

2025-05-13 companies

Canada, Monday, 12 May 2025.
Pan American Silver Corp. plans to purchase MAG Silver Corp. in a $2.1 billion cash and stock deal. This acquisition strengthens Pan American’s stake in Mexico’s Juanicipio mine, adding 58 Moz to its reserves.

Strategic Consolidation in the Mining Sector

Pan American Silver Corp. (PAAS), a leading silver and gold producer with operations across the Americas, has entered a definitive agreement to acquire MAG Silver Corp. (MAG) for about $2.1 billion. This transaction, a mix of cash and stock, will strengthen Pan American’s portfolio by acquiring a 44% interest in the Juanicipio mine in Mexico, a high-grade silver mining operation owned jointly with Fresnillo plc, which holds the remaining 56% interest [3][4][5].

Details of the Acquisition

The acquisition deal includes a cash payment of $500 million and 0.755 Pan American shares for each MAG share, setting MAG’s share price at $20.54 as of the closing on May 9, 2025. This price represents a premium of approximately 21% over MAG’s recent closing price and 27% over its 20-day volume-weighted average price [1][2][5]. MAG shareholders will have a stake of about 14% in Pan American on a fully diluted basis after the transaction’s completion [3][6].

Enhancing Reserves and Future Prospects

By acquiring MAG Silver, Pan American adds significant value to its reserves, with an addition of 58 million ounces of silver from Juanicipio, projected to produce 14.7 million to 16.7 million ounces in 2025. The mine is expected to generate approximately $98 million in free cash flow for Pan American, based on its 44% stake [4]. This strategic acquisition underscores the industry’s trend toward consolidation amidst fluctuating metal prices and economic uncertainties [5][6].

Timeline and Approval Process

The acquisition was officially announced on May 11, 2025, with a special shareholder meeting for MAG set for July 2025 to finalize the transaction [1]. The deal is anticipated to close in the second half of 2025, pending customary conditions and regulatory approvals [2][6]. Executives and directors of MAG, including CEO George Paspalas, have expressed strong support, viewing it as a compelling opportunity for shareholders to gain exposure to Pan American’s expansive assets [3][5].

Sources

silver acquisition mining deal