Silverco Announces Agreement to Acquire Nuevo Silver and the La Negra Mine in Queretaro Mexico

Executive Summary

• Silverco Mining Ltd. entered into a binding letter to acquire Nuevo Silver Inc., which holds 100% of the producing La Negra Silver Mine in Querétaro, Mexico.
• The transaction will provide immediate cash flow, approximately US$8 M in cash on closing, and add an operating mine that is currently running at ~55% capacity.
• Post‑closing, former Nuevo Silver shareholders will own ~34% of Silverco’s outstanding shares; the deal also assumes about US$11 M of debt plus future milestone and contingent payments.

Key Details

• Binding Letter Date: 19 January 2026.
• Structure: Three‑cornered amalgamation – Nuevo Silver will amalgamate into a wholly‑owned Silverco subsidiary; Nuevo Silver shareholders receive 16,802,316 new Silverco common shares.
• Ownership Impact: After the transaction, Nuevo Silver shareholders hold ~34% of Silverco’s outstanding shares; existing Silverco shareholders retain ~66%.
• Consideration:
• Cash on closing: ≈ US$8 M.
• Assumed debt: ≈ US$11 M (related to La Negra Mine).
• Milestone payments: US$12.5 M due Q1 2027.
• Contingent payments: Up to US$5 M payable between Q1 2027 and Q1 2028.
• Asset Acquired: 100% of La Negra Silver Mine – an operating silver‑lead‑zinc‑gold mine with current production at ~55% capacity, providing immediate cash flow.
• Strategic Benefits: Immediate production, diversification of asset base, addition of an experienced Mexican operating team, and acceleration toward a 10 M oz AgEq producer target within three years (including planned restart of the Cusi Property in H2 2026).
• Regulatory/Closing Conditions: Subject to customary approvals, TSX‑V exchange conditional approval, receipt of technical report (if required), favorable fairness opinion, and board approval. Closing will occur as soon as practicable after satisfaction or waiver of conditions precedent.
• Related Party Transaction: Insiders will acquire Nuevo Silver shares; exemption from formal valuation/minority shareholder approval under MI 61‑101 sections 5.5(b) & 5.7(1)(a).
• Advisors: Canaccord Genuity Corp. (financial advisor to Silverco); DLA Piper (legal counsel to Silverco); Cassels Brock & Blackwell LLP (legal counsel to Nuevo Silver).
• Qualified Person: Nico Harvey, VP Project Development, reviewed and approved all scientific/technical information per NI 43‑101.

Notable Quotes

“The acquisition of Nuevo Silver and the La Negra Mine is a transformative milestone that immediately shifts Silverco from a developer into a cash‑flowing producer… This accretive acquisition delivers immediate shareholder value and, when combined with our wholly‑owned Cusi Property… accelerates our vision to become a 10M oz AgEq producer within 3 years.” – Mark Ayranto, President & CEO, Silverco Mining Ltd.