en.Wedoany.com Reported - Sierra Madre Gold and Silver has completed the acquisition of the Del Toro silver mine in Zacatecas, Mexico, from First Majestic Silver Corp. for a total transaction value of up to $60 million. The acquisition was funded through a C$57.5 million private placement, with an additional up to $30 million in contingent milestone payments tied to resource and production targets.
The transaction was announced in December 2025 and approved at a special meeting of Sierra Madre shareholders on April 28, 2026. At closing, Sierra Madre paid First Majestic $20 million in cash and issued 10,870,000 common shares at a price of C$1.30 per share. Within 18 months of closing, Sierra Madre must make an additional payment of $10 million, payable in cash or shares valued at market price, capped at 10,575,385 common shares. Two additional contingent payments of $10 million each are tied to performance milestones: the first is triggered if Sierra Madre files a NI 43-101 technical report within 48 months demonstrating mineral resources of at least 100 million ounces of silver equivalent (AgEq); the second is triggered if the company achieves commercial production of at least 4,000 tonnes per day for 30 consecutive days within 60 months of closing. Shares issued to First Majestic are subject to a four-month statutory hold period and will be released in four equal tranches of 25% between December 2026 and June 2028. Following the transaction, First Majestic now holds 62,433,076 common shares, representing approximately 24.77% of issued shares (pre-dilution).
Concurrent with the acquisition, Sierra Madre completed a subscription receipt private placement led by underwriters, raising C$57.5 million (including full exercise of the underwriters' over-allotment option). Beacon Securities acted as lead agent and sole bookrunner, with Canaccord Genuity, BMO Capital Markets, and VSA Capital forming the underwriting syndicate. Net proceeds were used for the acquisition, with the remainder allocated to exploration and working capital at Del Toro.
Del Toro is a permitted, historically producing silver-gold-lead underground mine located in the Chalchihuites district of Zacatecas. The property includes 70 mining concessions covering 2,129 hectares and operated from 2013 to 2019, averaging annual production of 2.54 million ounces of silver equivalent between 2015 and 2018. The property includes three underground mining centers—Perseverancia, San Juan, and Dolores—with over 62.5 kilometers of existing underground workings. On-site processing infrastructure includes a 3,000-tonne-per-day flotation circuit (equipped with three mills) capable of processing sulfide and oxide concentrates, as well as a dry-stack tailings facility designed to support 2,000 tonnes per day for 12 years of operation. Historical measured and indicated resources compiled from First Majestic's March 2025 regulatory filings total 592,000 tonnes grading 201 g/t silver, 0.43 g/t gold, 3.90% lead, and 4.27% zinc, equivalent to 7.57 million ounces of silver equivalent.
Alex Langer, President and CEO of Sierra Madre Gold and Silver, stated that the acquisition of Del Toro is a significant step toward the company's goal of becoming a mid-tier silver producer, with existing production infrastructure already in place. The company is now focused on a near-term resource expansion drilling program of approximately 30,000 meters, which is expected to support an updated mineral resource estimate, potentially followed by a mine restart.
The Del Toro transaction is Sierra Madre's second acquisition from First Majestic. Previously, the company acquired the La Guitarra silver-gold mine in Temascaltepec, State of Mexico, in 2023 for approximately $44.89 million. La Guitarra is a high-grade underground mine covering over 39,000 hectares, which was placed on care and maintenance from 2018 until its restart following Sierra Madre's acquisition. Since then, the company has opened three mining centers at the property—La Guitarra, Coloso, and Nazareno—with material reconciliation at Nazareno showing silver grades 40% higher and gold grades 30% higher than the 2023 resource model. Sierra Madre intends to apply the same infrastructure-led restart approach at Del Toro. Greg Liller, Executive Chairman and COO of Sierra Madre, previously noted that Del Toro fits this business model, with its built processing plant and strategic land position in the vast, underexplored Chalchihuites district, and that First Majestic did an excellent job keeping permits current and maintaining the mine and mill in operable condition. Mexico's Federal Economic Competition Commission (COFECE) approved the antitrust review of the Del Toro transaction prior to closing.
The Del Toro transaction closes amid intensifying silver mining activity in Mexico. Guanajuato Silver Company plans a record 75,000 meters of drilling in 2026 across five producing underground mines in Guanajuato and Durango states. Sinda Ltd., backed by The Electrum Group, filed an application with the U.S. Securities and Exchange Commission in June 2026 for an initial public offering on the New York Stock Exchange, targeting up to $100 million in financing to advance a pre-production gold-silver project in Guanajuato. Mexico leads global silver production, accounting for approximately 25% of the world market, and ranks among the top 15 producers of 19 minerals, 12 of which are considered critical by the United States. According to forecasts cited at the 2026 PDAC Mexico Mining Forum, a comprehensive critical minerals policy could attract $43 billion in investment and create 500,000 jobs by 2030. Since the 2023 federal mining law reform, Mexico's mining investment environment has been affected by regulatory restrictions, which shortened concession terms from 50 to 30 years and imposed stricter environmental and social requirements. As of early 2026, approximately 160 projects were stalled due to missing environmental permits. Although the Sheinbaum administration has accelerated approvals, clearing 100 of 175 pending permits and unlocking approximately $11 billion in project backlog. According to state economic officials, the backlog of local permits in Zacatecas, where Del Toro is located, has been reduced from 25 pending to 5 within a year.
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