MAG Silver (MAG) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition adds a 44% interest in Juanicipio, a high-grade, low-cost silver mine in Mexico, strengthening the acquirer's position as a leading global silver producer and enhancing its Americas-focused strategy.

• The deal solidifies the acquirer's status as holding the largest silver reserves and resources among silver mining companies.

• Provides significant exploration upside at Juanicipio (only 10% explored), Deer Trail, and Larder projects.

• Addresses single-asset and jurisdiction risk for the acquired company, integrating its core asset into a diversified portfolio.

• Deploys $500 million of cash in a measured, strategic manner to enhance silver exposure and future growth.

Financial terms and conditions

• Total consideration of $2.1 billion, or $20.54 per share, with $500 million in cash and 0.755 shares per MAG share, subject to proration and aggregate limits.

• Shareholders can elect cash, shares, or a mix, subject to a $500 million cash cap and proration.

• Premiums of 21% and 27% to closing price and 20-day VWAP, respectively.

• MAG shareholders will own about 14% of the combined company post-transaction.

• $60 million break fee applies.

Synergies and expected cost savings

• Silver production to increase by 34% to up to 27.4 million ounces in 2025, solidifying position as the second-largest primary silver producer globally.

• Juanicipio's low all-in sustaining costs ($6–$8/oz) will reduce pro forma costs by over $3.00/oz, a ~20% reduction.

• High-margin ounces expected to boost free cash flow by $98 million in 2025, with 23% growth over three years.

• Transaction is significantly accretive to silver production and cost profile.

• Synergies anticipated from operational proximity and collaboration with Fresnillo.