Fresnillo sells stake in MAG Silver following Pan American deal

Fresnillo PLC on Friday said it has sold the majority of its stake in MAG Silver Corp, following the announced takeover of the Canadian miner by Pan American Silver Corp, citing a misalignment with its strategic investment priorities.

The Mexico-focused silver and gold miner said the transaction would have seen its over 9% stake in MAG Silver converted into less than 1% of Pan American, a mining company based in Canada with operations in Latin America.

Fresnillo said the resulting stake ‘does not align with [its] strategic investment objectives nor with the interests of its shareholders.’

‘Fresnillo originally acquired its stake in MAG Silver as a strategic investment in a single-asset company to support the strong partnership at Juanicipio,’ the company said. Juanicipio is a high-grade silver mine in Mexico, operated by Fresnillo and jointly owned with MAG Silver.

Fresnillo stressed that it remains confident in the operational and financial performance of the Juanicipio mine, which continues to be a core part of its portfolio. The terms of the Juanicipio partnership remain unchanged, and Fresnillo said it looks forward to collaborating with Pan American should the proposed acquisition close.

Shares in Fresnillo were down 0.6% at 1,010.00 pence in London early on Friday.

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