- Pan American Silver (TSX:PAAS) plans to sell its stake in its Argentina copper project to Swiss commodities giant Glencore (OTC:GLNCY) for US$475 million
- The miner is selling its 56.25 per cent stake in the Minera Agua Rica Alumbrera (MARA) mine
- Pan American is also selling its Morococha mine in Peru, and the Agua de la Falda project in Chile
- Pan American Silver Corp. opened trading at C$21.27 per share
Pan American Silver (TSX:PAAS) plans to sell its stake in its Argentina copper project to Swiss commodities giant Glencore for US$475 million.
PAAS stock shot up 5.2 per cent on the news, adding to its 15 per cent growth on the month.
The miner is selling its 56.25 per cent stake in the Minera Agua Rica Alumbrera (MARA) mine. Glencore PLC (OTC:GLNCY) holds a 43.75 per cent interest in the mine, and once the transaction is complete, it will assume total ownership.
The mine was initially established as a joint venture between Yamana Gold Inc., Glencore and Newmont Corp. (NYSE:NEM) in December 2020 after the integration of the Minera Alumbrera plant and mining infrastructure and the Agua Rica project.
Pan American is also selling its Morococha mine in Peru, and the Agua de la Falda project in Chile.
These transactions are expected to be completed in Q3 2023.
Pan American President and Chief Executive Officer Michael Steinmann explained in a news release that selling these non-core assets was a move to optimize the company’s portfolio after the Yamana acquisition in March for US$4.8 billion.
“The consideration for the sale of MARA, coupled with the other sales, will yield total cash proceeds of US$593 million. The cash proceeds will allow us to both fully repay the amount drawn on our credit facility and increase our cash position, further enhancing the resilience of our balance sheet,” Steinmann said in a statement. “These transactions will also allow Pan American to reduce its annual project development, reclamation and care and maintenance costs, which for MARA and Morococha amounted to US$15.7 million in Q2 2023. This improved balance sheet strength creates enhanced opportunities for the company, providing increased capital to advance key strategic projects, including the La Colorada Skarn Project.”
Pan American Silver Corp. is engaged in silver and gold mining and related activities, including exploration, mine development, extraction, processing, refining and reclamation.
Pan American Silver Corp. opened trading at C$21.27 per share.
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