Pan American Silver Acquires MAG Silver

Pan American Silver announced it will acquire MAG Silver in an agreement valued at approximately US$2.1 billion. The transaction will give Pan American Silver shareholders a 44% interest in the Juanicipio mine in Zacatecas.

According to the transaction terms, MAG Silver shareholders will receive total consideration of approximately US$2.1 billion, representing US$20.54 per MAG Silver share, based on Pan American Silver’s closing share price on the New York Stock Exchange (NYSE) on May 9, 2025. The consideration will comprise US$500 million in cash and 0.755 Pan American shares per MAG Silver share. The consideration represents premiums of approximately 21% to MAG Silver’s closing price and 27% to its 20-day volume-weighted average price on the NYSE American ending May 9, 2025. Following the transaction, existing MAG Silver shareholders are expected to own approximately 14% of Pan American shares on a fully diluted basis.

For Pan American shareholders, the transaction adds a 44% interest in the Juanicipio mine, described as a large-scale, high-grade, low-cost silver mine with significant exploration upside in Zacatecas. MAG Silver holds a 44% interest in Juanicipio, a joint venture (JV) with Mexico-based silver company Fresnillo, which operates the asset. “Our acquisition of MAG brings into Pan American’s portfolio one of the best silver mines in the world. Furthermore, we see future growth opportunities through the significant exploration potential at Juanicipio as well as MAG’s Deer Trail and Larder properties. This strategic acquisition further solidifies Pan American as a leading Americas-focused silver producer,” says Michael Steinmann, President and CEO, Pan American Silver. 

Juanicipio is forecasted to produce between 14.7Moz and 16.7Moz of silver in 2025, of which 6.5Moz to 7.3Moz would be attributable to MAG Silver. The acquisition is expected to add 58Moz of silver to Pan American’s proven and probable reserves, 19Moz to measured and indicated resources, and 35Moz to inferred resources. Juanicipio is expected to contribute high-margin ounces, with forecasted 2025 cash costs of -US$1/oz to US$1/oz and all-in sustaining costs of US$6/oz to US$8/oz. Juanicipio is expected to generate approximately US$200 million in free cash flow in 2025 with US$98 million pro forma for Pan American’s share. 

The transaction will offer MAG Silver shareholders diversified exposure to Pan American’s portfolio of 10 silver and gold mines across seven countries. It is expected to derisk shareholders’ exposure by converting a concentrated interest in Juanicipio into equity ownership in a diversified producer known for returning capital. Benefits also include increased liquidity and market presence. “Through the acquisition of our interest by Pan American, a respected leader in the global precious metals industry, our shareholders will participate in an exciting future defined by operational excellence, substantial exploration potential, and strong financial stewardship with significant portfolio exposure,” said George Paspalas, President and CEO, MAG Silver.

The transaction is expected to close in 2H25, subject to customary conditions, including clearance under Mexican antitrust laws and approval for listing Pan American shares on the Toronto Stock Exchange (TSX)  and the NYSE.

Juanicipio Mine’s Importance 

The Juanicipio mine is located in Zacatecas, the best-performing mining state in Mexico, producing over 44.9% of Mexico’s silver output, as reported by MBN. According to CAMIMEX Annual Report 2024, Juanicipio is Mexico’s fifth-largest silver producer mining unit, just behind Fresnillo’s Saucito and San Julian mines, and Newmont’s Peñasquito mine.