First Majestic Raises $350 Million in Convertible Notes—Debt Refinancing and Growth in Focus

$174.7 Million of Existing Notes Repurchased, Sizable Refinancing at Lower Coupon

First Majestic Silver Corp. (NYSE: AG) has finalized a major financial move by closing its offering of $350 million in unsecured convertible senior notes due 2031. The issuance includes an additional $50 million through a fully exercised over-allotment option. Notably, the new notes carry an ultra-low coupon of just 0.125%, which stands out in the current interest rate landscape and extends the company's debt maturity to 2031.

Of the proceeds, approximately $214.7 million will be used to repurchase $174.7 million of existing 0.375% convertible senior notes due in 2027—effectively reducing near-term refinancing risk and pushing out the company's next major debt maturity by four years, while marginally reducing annual interest costs.

Capital Allocation Signals Focus on Flexibility and Strategic Growth

The remainder of the funds from the convertible notes offering is earmarked for general corporate purposes, which may include advancing existing mining assets or pursuing new opportunities. With an initial conversion rate set at 44.72 shares per $1,000 principal (roughly a $22.36 conversion price), investors in the notes are positioning for potential long-term upside if the company's equity appreciates.

This strategic move gives First Majestic added liquidity and optionality—key advantages as the mining industry faces volatility in both metals pricing and capital markets.

Industry Implications: Debt Maturity Extension and Balance Sheet Health

Extending its major debt maturity out to 2031 provides First Majestic with greater flexibility to navigate commodity cycles and potentially invest in operational expansion without near-term debt pressures. The refinancing, coupled with a low-interest burden, helps maintain balance sheet health while minimizing shareholder dilution risk—at least until (or unless) the conversion price is met.

Key Takeaway: Balance Sheet Strength Enhanced, Investors Watching for Next Moves

While these capital markets transactions are largely financial engineering, the bigger story for investors may be First Majestic’s stronger foundation to weather industry shifts and act quickly on strategic growth opportunities. With silver and gold markets in flux and new projects in both Mexico and the U.S., investors will be keen to see how management puts this financial flexibility to work.

In summary: First Majestic has executed a sizeable convertible note deal to push out debt maturities and free up capital for growth. Investors and analysts will be watching closely for any new developments in the company’s production profile, project pipeline, or strategic initiatives over the coming quarters.

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