Coeur Mining’s Bold Acquisition Play Reshapes the Precious Metals Landscape

In a transformative move set to dramatically alter its market position, Coeur Mining has announced plans to acquire competitor New Gold in a monumental $7 billion transaction. The ambitious deal would instantly elevate the mid-tier precious metals producer into North America's major leagues, though initial market reaction saw Coeur shares decline by 7 percent as investors assessed the strategic implications.

The merger fundamentally repositions Coeur Mining within the global resources sector. The combined entity will operate seven mines instead of the current five, with projected annual production reaching 1.25 million gold equivalent ounces. This output includes 20 million ounces of silver, 900,000 ounces of gold, and 100 million pounds of copper.

This production surge will catapult Coeur into the ranks of the world's top ten precious metals producers and establish the company as the fifth-largest silver producer globally. The acquisition particularly strengthens Coeur's portfolio through New Gold's Canadian assets—the New Afton copper-gold mine and Rainy River gold mine—strategically diversifying the company from a pure precious metals focus to a more balanced commodity producer with significant copper exposure.

Financial Metrics Signal Dramatic Growth

While the acquisition price initially appears substantial, deeper analysis reveals a compelling growth narrative. The merged company anticipates generating approximately $3 billion in EBITDA and $2 billion in free cash flow by 2026.

The contrast with Coeur's recent financial performance is striking. Just two years ago, the company reported EBITDA of only $142 million alongside negative free cash flow of $297 million. Even for the current year of 2025, Coeur projects EBITDA of roughly $1 billion, meaning the acquisition would effectively triple profitability.

Recent quarterly results provided early evidence of operational strength, with the third quarter of 2025 delivering record revenue of $555 million, operating cash flow of $238 million, and net income of $267 million.

Should investors sell immediately? Or is it worth buying Coeur Mining?

Market Analysts Respond Positively to Strategic Move

Financial institutions have responded favorably to the announcement. TD Securities promptly raised its price target to $25 while maintaining a buy recommendation. S&P Global expressed similar confidence, placing Coeur's credit rating on "CreditWatch Positive," indicating potential credit rating improvements ahead.

The transaction, scheduled for completion in the first half of 2026, remains subject to regulatory approvals. Coeur plans to list on the Toronto Stock Exchange to better access Canadian investors, while New Gold CEO Patrick Godin will join the board of directors—a gesture toward integration.

Under the terms of the agreement, New Gold shareholders will receive 0.4959 Coeur shares for each share held, representing a 16 percent premium. Following transaction closure, existing Coeur investors will hold 62 percent of the combined company, with New Gold shareholders owning the remaining 38 percent.

Strategic Positioning in Evolving Commodity Markets

With silver representing 30 percent of total reserves, Coeur positions itself advantageously within markets benefiting from the electric vehicle and solar energy megatrends. The anticipated market capitalization of $20 billion could potentially qualify the company for inclusion in major US indices, attracting additional institutional investment.

Daily trading liquidity is expected to surpass $380 million, providing crucial accessibility for larger investors. The strengthened balance sheet also creates opportunities for organic growth, with expansion projects including the K-Zone extension at New Afton, exploration initiatives at Rainy River, and additional developments across operations in the United States, Mexico, and Canada.

While the success of this ambitious move remains to be seen, the combination of operational strength, strategic rationale, and attractive valuation creates a compelling investment proposition—particularly within a context of rising precious metal prices.