First Majestic Silver to Sell its Mexico Mine for Up to $60 Million

MT Newswires Live12-18

First Majestic Silver (AG) said Wednesday it has agreed to sell its fully owned Del Toro Silver Mine in Zacatecas, Mexico, to Sierra Madre Gold & Silver for up to $60 million in cash and shares.

The consideration consists of $30 million on closing and up to $30 million in delayed and contingent payments.

Under the deal, Sierra Madre will pay First Majestic $20 million in cash and $10 million in shares at a price of $1.30 per share, the company said.

Within 18 months after closing, Sierra Madre will pay $10 million in cash or shares, the company said.

Sierra Madre will also pay First Majestic several potential $10 million in cash and shares payments in subsequent years if the mine achieves certain technical and production thresholds, the company said.

The transaction is conditional upon Sierra Madre completing a concurrent private placement financing raising at least 40 million Canadian dollars ($29 million) in gross proceeds, the company said.

Sierra Madre will seek shareholder approval for the transaction by April, the company said.

Shares of the company were down 1% in recent premarket activity Thursday.

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