The deal comes amid a sharp rally in the silver market, which hit a 13-year high earlier this week as investors rushed to safe haven assets in response to rising geopolitical risks. The precious metal has jumped 25% this year, compared with a 30% rise in gold.
Dundee said the cash and share offer to buy Adriatic is valued at 268 pence, around 51% higher than the company's share price before the takeover talks were announced last month.
The deal is the latest in a series of mid-sized deals among precious metals producers that are using high share prices and big profits to grow. Australia's Northern Star Resources Ltd. and South Africa's Gold Fields Ltd. and Harmony Gold Mining Co.
According to Bloomberg estimates, in 2024 the value of concluded and proposed deals in precious metals increased by almost a quarter and accounted for more than half of the total volume of deals concluded in the metals sector.
Adriatic operates the Vares silver mining project, about 50 kilometers (31 miles) north of Sarajevo. The project came on stream last year and produces silver, lead and zinc. Dundee also has mining projects in the Balkans.
Source: Bloomberg
