SILVERCORP TO ACQUIRE ADVENTUS, CREATING A GEOGRAPHICALLY DIVERSIFIED MINING COMPANY BY ADDING THE ADVANCED EL DOMO PROJECT

Core Viewpoint - Silvercorp Metals Inc. has entered into a definitive arrangement agreement to acquire Adventus Mining Corporation, enhancing its asset portfolio and geographic diversification while providing immediate value to Adventus shareholders through a significant premium [1][2][3] Transaction Details - Each holder of Adventus shares will receive 0.1015 Silvercorp shares for each Adventus share, implying a consideration of C$0.50 per Adventus share, representing a 31% premium based on the 20-day volume-weighted average prices as of April 25, 2024 [2] - The implied equity value of the transaction is approximately C$200 million on a fully-diluted basis [2] - Upon closing, existing Silvercorp and Adventus shareholders will own approximately 81.6% and 18.4% of Silvercorp shares, respectively [2] Strategic Rationale - The acquisition provides immediate asset, geographic, and metal diversification, with exposure to key metals for a low-carbon future [3] - The addition of the El Domo project is expected to significantly enhance Silvercorp's near-term production profile [3] - Silvercorp has secured key permits and has a US$175.5 million stream with Wheaton Precious Metals to fund the El Domo project [3] Benefits for Adventus Shareholders - Adventus shareholders will receive a 31% premium and gain exposure to Silvercorp's profitable silver mines and strong balance sheet [5] - The transaction de-risks the development of El Domo by leveraging Silvercorp's technical capabilities and financial strength [5] - There is potential for further premium through a re-rating of Silvercorp shares as El Domo advances to production [5] Project Overview - The El Domo project, located in Ecuador, is a high-grade copper-gold project with a proven and probable mineral reserve of 6.5 million tonnes [7][8] - The project has a 10-year mine life with average annual production metrics and attractive operating costs [8] Financing and Placement - Concurrently, Silvercorp will subscribe for 67,441,217 Adventus shares at C$0.38 per share, totaling approximately C$25.6 million [9] - Proceeds from the placement will be used to repay existing debts and fund activities at the El Domo project [10] Approval Process - The transaction requires approval from Adventus shareholders and is expected to be completed in the third quarter of 2024 [13][15] - The board of directors of Adventus has unanimously approved the transaction and recommends shareholder support [15][16]