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Pan American Silver CEO defends Minefinders price

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Pan American Silver is defending the premium it paid in its $1.5 billion acquisition of Minefinders Corp.

CEO Geoff Burns tells BNN the premium reflects the relative contributions of each company in the combined entity.

“When I looked at we were getting from Minefinders versus what we had ourselves, that premium looked like it was a relatively fair value. Fair for them, as well as fair for our shareholders,” he says.

What Pan American Silver gets is 117 million ounces of silver and three million ounces of gold in the ground, he says.  “And you get the opportunity to expand that and make potentially more money at it than the current company is doing.”

Analysts had questioned the premium Pan American was paying to acquire Minefinders.

TD Securities analyst Daniel Earle said in a note to clients that Pan American "is acquiring underperforming assets at what appears to be a full price primarily using what we see as its relatively undervalued shares."
 

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