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First Majestic Bows Out of Orko Auction

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With several hours remaining before deadline, First Majestic Silver (NYSE: AG  ) finally decided to put an end to the suspense. In a press release Tuesday evening, the silver and gold miner announced that after careful consideration, it has decided not to match Coeur d' Alene's (NYSE: CDE  ) $383.3 million "Superior Proposal" to buy Orko Silver Corp. (UNKNOWN: OKOFF.DL  ) .

In a statement, First Majestic President & CEO Keith Neumeyer stated: "It is our view that by increasing the offer beyond our previous bid, the economics of the La Preciosa project drop below our minimum requirements for a rate of return and financial payback to our shareholders; therefore, we will not attempt to match the Coeur offer for La Preciosa."

What this means, in essence, is that Orko is now free to accept Coeur's purchase offer. In so doing, it will be obligated to pay First Majestic a $11.6 million breakup fee. Coeur will presumably now do this.

Coeur d' Alene shares closed down 3.4% at $20.34 in Tuesday trading ahead of First Majestic's announcement. Orko was off 1.6% at $2.43. First Majestic got off relatively unscathed, dropping 1.2% to close at $17.

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Rich Smith

I love things that go "boom." Sonic or otherwise, that means I tend to gravitate towards defense and aerospace stocks. But to tell the truth, over the course of a dozen years writing for The Motley Fool, I have covered -- and continue to cover -- everything from retailers to consumer goods stocks, and from tech to banks to insurers as well. Follow me on Twitter or Facebook for the most important developments in defense & aerospace news, and other great stories besides.

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Related Tickers

11/27/2015 1:02 PM
AG $3.22 Down -0.04 -1.23%
First Majestic Sil… CAPS Rating: ***
CDE $2.50 Down -0.09 -3.47%
Coeur d'Alene Mine… CAPS Rating: ***
OKOFF.DL $0.00 Down +0.00 +0.00%