SCHEDULE 13D/A: Fresnillo and Penoles Group Significantly Reduce Stake in MAG Silver Corp., Ceasing Major Shareholder Status

A group of Mexican mining companies, including Fresnillo plc and Industrias Penoles, have significantly reduced their beneficial ownership in MAG Silver Corp. through recent share sales, falling below the 5% reporting threshold.

Summary

• Fresnillo plc, Industrias Penoles, S.A.B. de C.V. (IPSA), and Minas Penoles, S.A. de C.V. (Minas), collectively the Reporting Persons, have filed Amendment No. 4 to their Schedule 13D.
• The amendment reports the sale of an aggregate of 7,371,340 Common Shares of MAG Silver Corp. between May 12, 2025, and June 2, 2025.
• Fresnillo plc disposed of 7,171,340 shares in the open market, with prices ranging from CAD$25.2281 to CAD$27.1405.
• Minas Penoles, S.A. de C.V. disposed of 200,000 shares in the open market, with prices ranging from CAD$25.7338 to CAD$26.9156.
• These sales exceeded 1% of the total outstanding shares on May 12, 2025.
• As of May 14, 2025, the Reporting Persons ceased to be the beneficial owner of more than 5% of MAG Silver Corp.'s shares.
• The Reporting Persons now beneficially own an aggregate of 2,374,853 shares, representing approximately 2.3% of the outstanding shares.
• This filing represents the final amendment to the Schedule 13D and constitutes an exit filing for the Reporting Persons as a group.
• The Reporting Persons state they hold the remaining shares for investment purposes and intend to continue evaluating their investment, potentially disposing of all or a portion of the remaining shares.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to a major shareholder group significantly reducing their stake and exiting their 5%+ beneficial ownership, which can be perceived as a lack of strong long-term conviction. The stated intent to potentially sell remaining shares adds to this slight negative outlook.

Negatives

• A significant reduction in stake by a major institutional shareholder group (Fresnillo and Penoles) could be perceived negatively by the market, potentially signaling a lack of long-term conviction or a strategic shift away from the investment.
• The stated intention of the Reporting Persons to potentially dispose of all or any portion of their remaining 2.3% stake could create future selling pressure on MAG Silver Corp.'s shares.

Risks

• The Reporting Persons may dispose of all or any portion of their remaining 2,374,853 shares (approximately 2.3% of outstanding shares) through open market transactions, block trades, or privately negotiated transactions, which could exert downward pressure on MAG Silver Corp.'s stock price.
• Future actions regarding the investment are dependent on market conditions, trading prices, financial condition of the Issuer, and general economic/industry conditions, introducing uncertainty.

Future Outlook

The Reporting Persons intend to continue evaluating their investment in MAG Silver Corp. on an ongoing basis. They retain the right to determine future actions, which may include the disposition of all or any portion of their remaining 2.3% beneficial ownership through various market transactions, subject to applicable laws and regulations.

Management Comments

• The Reporting Persons are holding the Shares for investment purposes and intend to continue to evaluate their investment and the Issuer on an ongoing basis.
• The Reporting Persons intend to take such actions with respect to their investment and the Issuer as they deem appropriate, which actions may include, without limitation, the disposition of all or any portion of the Shares they beneficially own.
• Any future actions will be dependent on their evaluation of market conditions, current and anticipated future trading prices of the shares, the financial condition, results of operations and prospects of the Issuer, general economic and industry conditions, and other factors that the Reporting Persons may deem relevant.

Industry Context

This filing primarily details a change in beneficial ownership by a group of major mining companies in another mining company. While not directly indicative of broader industry trends, a significant reduction in stake by a strategic investor like Fresnillo/Penoles could be interpreted by some as a shift in their investment strategy or a re-evaluation of the specific asset (MAG Silver Corp.). However, the document does not provide sufficient detail to draw definitive conclusions about wider industry implications.

Legal Proceedings

• None of the Reporting Persons has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) in the last five years.
• None of the Reporting Persons was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction resulting in a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws in the last five years.

Related Party Transactions

• Industrias Penoles, S.A.B. de C.V. (IPSA) is the beneficial owner of approximately 74.99% of the outstanding ordinary shares of Fresnillo plc.
• IPSA is the sole shareholder of Minas Penoles, S.A. de C.V.

Stakeholder Impact

• Shareholders of MAG Silver Corp. may react to the reduction in institutional ownership by Fresnillo and Penoles, potentially leading to short-term price volatility.
• The potential for further sales of the remaining stake by the Reporting Persons could create ongoing selling pressure, impacting existing shareholders.

Next Steps

• The Reporting Persons will continue to evaluate their investment in MAG Silver Corp.
• The Reporting Persons may dispose of all or any portion of their remaining 2.3% beneficial ownership in MAG Silver Corp. through open market transactions, block trades, or privately negotiated transactions.

Key Dates

Keywords

MAG Silver Corp, Fresnillo plc, Industrias Penoles, Minas Penoles, Schedule 13D, share sale, stake reduction, beneficial ownership, mining, precious metals, silver, Mexico, United Kingdom