Mexico Approves Pan American-Yamana Gold Agreement

Canada-based precious metals company Yamana Gold announced that the Federal Comission for Economic Competitiveness (COFECE) has recently approved the sale of all its common shares to Pan American Silver. The acquisition set the way to transform Pan American Silver into a leading silver producer. 

On Nov. 4, 2022, Pan American Silver and Agnico Eagle announced they delivered a binding offer to Yamana’s board of directors. The agreement established that Pan American Silver would acquire all of Yamana Gold’s shares and Agnico Eagle would buy certain partnerships and subsidiaries in which Yamana holds an interest.

Under the Pan American-Agnico offer, each Yamana share would be exchanged for approximately US$1.04 in cash, 0.1598 Pan American shares and 0.0376 Agnico Eagle shares, which total US$5.02 per Yamana share. At that time, the total value was calculated based on the closing price of Pan American Silver and Agnico Eagle’s shares from Nov. 3, 2022. The companies said that the offer was not subject to any financial condition, nor additional due diligence. 

Pan American Silver considered the agreement advantageous since it would improve its position as a major metal producer, with over 30Moz/y of silver and 1.2Moz/y of gold, while adding four operating mines to the 12 projects it already had. Agnico Eagle, on the other hand, believes its experience and presence in the area where Yamana Gold operates will boost the mine’s potential. 

Both Pan American Silver and Yamana Gold reported that COFECE approved the agreement on Mar. 23, 2023. “All required regulatory, shareholder and court approvals, including the final court order, have now been received and the arrangement is anticipated to be completed on or about Mar. 31, 2023,” reads Pan American Silver’s report. 

Additionally, Pan American Silver declared a cash dividend of US$0.10 per common share, which must be payable on or about May 12, 2023, to holders of record of Pan American’s shares as of the close of markets on Apr. 14, 2023. The dividends are eligible for Canadian income tax purposes. The company stated it selected this record payment date to harmonize its dividend yield with respect to 1Q23 with Yamana’s usual course dividend timing for payment of a first quarter dividend. The company said that following dividends are expected to follow its previous payment schedules.