First Majestic Announces Proposed Sale of the Del Toro Silver Mine for up to US$60M
First Majestic Sells Idle Asset for $60 Million to Bolster War Chest and Sharpen Focus
On December 17, 2025, First Majestic announced a definitive agreement to sell its non-core Del Toro Silver Mine to Sierra Madre Gold & Silver Ltd. The total consideration for the sale is up to US$60 million, structured as follows: - Upfront Consideration: US$20 million in cash and US$10 million in Sierra Madre shares upon closing. - Contingent Payments: Three separate milestone payments of US$10 million each. These are triggered by: 1. Defining a NI 43-101 resource of at least 100 million silver-equivalent ounces within 48 months. 2. Achieving commercial production of at least 4,000 tonnes per day for 30 consecutive days within 60 months. 3. A US$10 million payment due within 18 months of closing.
The Del Toro mine has been on care and maintenance. The transaction's closing, expected in the first half of 2026, is subject to several conditions, including Sierra Madre completing a concurrent financing of at least CAD$40 million.
This is a strategically sound and financially positive transaction for First Majestic. The company is monetizing a non-producing, non-core asset that was likely incurring ongoing care and maintenance costs.
- Financial Impact: The upfront consideration of US$30 million (US$20M cash, US$10M shares) provides an immediate, non-dilutive boost to an already strong balance sheet. The company reported US$435.4 million in cash in its Q3 2025 results, and this sale will add to that war chest, providing further flexibility to fund its growth projects. The three contingent payments of US$10 million each represent significant potential upside at no cost to First Majestic.
- Strategic Impact: This sale is a clear example of portfolio optimization. Following the transformational acquisition of Gatos Silver (and its 70% stake in the Cerro Los Gatos mine) in early 2025, management is sharpening its focus on its four key producing assets and high-potential exploration projects like Navidad and Santo Niño at Santa Elena. Divesting a dormant asset simplifies the portfolio and frees up management time and resources.
- Contextual Analysis: This news follows a series of positive developments. The December 15 news highlighted exploration success and a plan to expand the Santa Elena plant. In early December, the company refinanced its debt by issuing US$350 million in new convertible notes to repurchase older notes, pushing out maturities. The Del Toro sale fits perfectly within this narrative of strengthening the company financially and operationally for future growth.
The market should react positively to this news as it demonstrates disciplined capital allocation and a clear focus on maximizing value from core assets. The risk is that the contingent payments are not realized, but the upfront value alone makes this a good deal for an idle asset.
First Majestic Silver Corp. is a Canadian-based mining company focused on silver and gold production in Mexico. Following its acquisition of Gatos Silver in January 2025, the company operates four producing mines: 1. San Dimas Silver/Gold Mine: A cornerstone, high-grade underground mine in Durango, Mexico. 2. Santa Elena Silver/Gold Mine: A key growth asset in Sonora, Mexico, with significant recent exploration discoveries (Navidad and Santo Niño) that have the potential to extend mine life and increase production. 3. Cerro Los Gatos Silver Mine (70% interest): A large, modern, and low-cost polymetallic mine in Chihuahua, Mexico, acquired through the Gatos Silver transaction. It is a major contributor to the company's production profile. 4. La Encantada Silver Mine: A pure silver mine in Coahuila, Mexico.
The company's strategy is to grow into the world's leading primary silver producer through a combination of acquisitions and organic growth from exploration.