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%PanAmericanSilver (NYSE: $PAAS ) has agreed to buy rival producer %MAGSilver (NYSE: $MAG ) for $2.1 billion U.S.

The acquisition provides Pan American with a major %Silver mine in Mexico.

Under terms of the deal, MAG shareholders will receive $500 million U.S. in cash and 0.755 ordinary shares of Pan American for each stock they own.

The purchase values MAG stock at $20.54 U.S., a 21% premium.

The deal between the two Canadian-based silver producers comes amid a rally in silver prices, which have gained more than 13% this year.

Rising prices have sparked consolidation among various silver miners.

The takeover gives Pan American control over MAG Silver’s 44% stake in the Juanicipio mine in Mexico, as well as two undeveloped projects: the Deer Trail mine in Utah and Larder in Canada.

“Our acquisition of MAG brings into Pan American’s portfolio one of the best silver mines in the world,” said Pan American Chief Executive Officer (CEO) Michael Steinmann, referring to the Mexico asset.

The Juanicipio mine produced 18.6 million ounces of silver in 2024, up 10% from the previous year, according to industry data. It is currently the world’s third-biggest silver mine.

The deal, which is subject to regulatory approvals, comes with a $60 million U.S. break-up fee.

The stock of Pan American Silver has risen 7% in 2025 to currently trade at $22.82 U.S. per share in New York.