Vancouver’s Pan American Silver Corp. (TSX,NYSE: PAAS) is officially bigger today than it was yesterday, and has a lot more gold, after completing a takeover of Yamana Gold.
The takeover plan, which has been estimated by law firm BLG to be worth US$4.8 billion, required Yamana Gold to sell its share of the Canadian Malartic mine to Agnico Eagle Mines Limited (TSX,NYSE: AEM).
That transaction is now complete and Agnico now owns 100 per cent of the Canadian Malartic mine, and Pan American Silver now owns four Yamana Gold mines: the Jacobina mining complex in Brazil, the El Peñón and Minera Florida mines in Chile, and the Cerro Moro mine in Argentina.
When combined with Pan American's 10 mines -- one in Canada, two in Mexico, one in Guatemala and six in South America - the acquisition gives Pan American 14 operating mines.
"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," said Pan American Silver CEO Michael Steinmann.
"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 capitalization and trading liquidity.”
Under the plan of arrangement, existing Pan American shareholders now own approximately 58 per cent of the Pan American shares and former Yamana Gold shareholders now own roughly 42 per cent of the Pan American shares.