The transaction adds four additional producing mines to Pan American’s portfolio, including the Jacobina mining complex in Brazil, the El Peñón and Minera Florida mines in Chile, and the Cerro Moro mine in Argentina
Pan American Silver acquires Yamana Gold. (Credit: Zac Edmonds on Unsplash)
Pan American Silver has completed its previously announced acquisition of all the issued and outstanding common shares of Yamana Gold for a total of up to $4.8bn.
The announcement follows the sale of Yamana’s Canadian assets, including certain subsidiaries and partnerships interests in the Canadian Malartic mine, to Agnico Eagle Mines.
Under the terms of the deal, Yamana shareholders received $1.0406 in cash for each Yamana Share held, along with 0.0376 shares of Agnico Eagle and 0.1598 shares of Pan American.
Yamana shareholders received $1bn in cash, 36.2 million Agnico Eagle Shares and 153 million Pan American.
Upon closing, existing Pan American shareholders owned about 58% of the Pan American Shares and former Yamana Shareholders around 42% of the Pan American Shares.
Pan American president and chief executive officer Michael Steinmann said: “This acquisition is transformative for Pan American, significantly increasing the scale of our operations in Latin America where we have been operating for nearly three decades.
“We expect a material increase in our production of silver and gold, while we continue to provide a preferred way to invest in silver through large silver mineral reserves and growth opportunities, further enhanced by the increase in our market capitalisation and trading liquidity.
“The acquisition is firmly aligned with our strategy of creating value by pursuing attractive growth opportunities, improving operating margins and extending mine life.”
The transaction provides Pan American with four additional producing mines in its portfolio.
It will add the Jacobina mining complex in Brazil, the El Peñón and Minera Florida mines in Chile, and the Cerro Moro mine in Argentina, along with the MARA development project in Argentina.
Pan American has further amended and restated its existing $500m sustainability-linked credit agreement, increasing it up to $750m.
BMO Capital Markets, The Bank of Nova Scotia and Canadian Imperial Bank of Commerce, led the amended revolving credit facility as Joint Lead Arrangers and Joint Bookrunners. Bank of Montreal served as administrative agent.
Furthermore, Yamana Shares are expected to be delisted from the Toronto Stock Exchange from the New York Stock Exchange immediately.