Torex Gold Resources has reached a definitive agreement to acquire Prime Mining, securing full ownership of the Los Reyes gold-silver project in Mexico.
The acquisition aligns with Torex’s strategic focus on expanding its resource base and capitalising on its established expertise in the region.
The transaction will be executed through a court-approved plan of arrangement.
Torex president and CEO Jody Kuzenko said: “The Los Reyes Project represents a unique opportunity for the Torex team to develop a high-quality asset with the potential for a high margin, low capital, and long-life operation in a jurisdiction that we know very well.
“The acquisition of Prime Mining, and the previously announced all-cash acquisition of Reyna Silver, support our strategy to systematically build a diversified, Americas-focused precious metals producer with a portfolio of producing, development, and exploration stage assets.
“Our extensive due diligence reinforced the scarcity of an asset of this quality, and we look forward to demonstrating the significant value we see in this exciting project.”
Los Reyes is an advanced exploration and development asset that features an indicated resource of around 1.5 million ounces of gold and 54.0 million ounces of silver.
The inferred category includes 538 thousand ounces of gold and 21.6 million ounces of silver. This acquisition significantly enhances Torex’s gold and silver resource portfolio.
Prime Mining shareholders will receive 0.060 of a Torex common share for each Prime Mining share held, a 32.4% premium to the 30-day VWAP of Prime Mining shares.
The exchange ratio values Prime Mining at around $449m, with existing Prime Mining shareholders set to own about 10.7% of Torex post-transaction.
The transaction requires approval from Prime Mining’s securityholders, with a special meeting expected in September 2025.
In addition, regulatory clearances, including those from the Toronto Stock Exchange (TSX) and Mexican antitrust authorities, are prerequisites for closing.
The transaction is anticipated to conclude in the second half of 2025.
Kuzenko added: “Los Reyes has multiple high-potential mineralised zones which remain open along strike and at depth, and we are confident that the project has strong untapped upside with numerous avenues for growth.
“Over the last 15 years, the Torex team has demonstrated the technical and in-country expertise to successfully advance projects from exploration through to development and production in Mexico, delivering considerable value to our shareholders.
“We will leverage these competencies, along with our significant expected free cash flow from the now completed Media Luna Project, to unlock and maximise the value of Los Reyes through development and production.
“We look forward to building strong relationships with the local communities in Cosalá, and we will work with them to ensure that the project delivers meaningful and sustainable benefits, just as we have and continue to do at Morelos.”
Both companies’ boards have unanimously approved the arrangement, with Prime Mining’s board recommending shareholders vote in favour.
The transaction includes customary deal protections, such as a termination fee of $12.5m payable to Torex if the deal is not completed.
The Prime Mining shares will be delisted from the TSX following the transaction’s closure.
Prime Mining CEO and director Scott Hicks said: “The addition of Prime Mining’s high-quality Los Reyes Project to the Torex pipeline as its next development asset presents both Prime Mining and Torex shareholders with substantial value enhancement through this share-based acquisition.
“In addition to gaining exposure to Torex’s free-cash-flowing Morelos Complex, Prime Mining shareholders can continue to realise significant value creation as Los Reyes is developed with the benefit of Torex’s operational and development experience in Mexico.
“Both companies are aligned in their community and employee-focused values, approach to environmental stewardship and commitment to ensuring that all stakeholders will benefit through this combination.”
