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Top silver miner Fresnillo drops $179 million Mag Silver bid

World No. 1 silver miner, LSE listed Fresnillo has withdrawn a hostile takeover offer for Canada's MAG Silver due to long delays in MAG supervising the completion of an independent valuation.

Posted: Monday , 22 Jun 2009

LONDON (Reuters)  - 

Mexico's Fresnillo Plc, the world's largest primary silver producer, has dropped a hostile takeover offer worth $179 million for MAG Silver.

London-listed Fresnillo said on Monday it dropped the bid due to long delays in Canada's MAG supervising the completion of an independent valuation of itself.

Fresnillo announced on Dec. 1 its intention to make a cash bid for the 80.2 percent of MAG it does not already own.

"It has not been possible to conclude the independent valuation of MAG required under applicable Canadian securities laws in order to permit the offer to proceed and it is not clear to Fresnillo when or if this will happen," a statement said.

Fresnillo, which had previously said MAG Silver was using delaying tactics, said on May 15 it was asking Canadian authorities to set a three-week deadline for the completion of the valuation.

MAG's main asset is a 44 percent stake in the Juanicipio property, a joint venture with Fresnillo. Juanicipio is in north-central Mexico, near Fresnillo's namesake mine.

On April 15, Fresnillo posted strong first-quarter output data and said costs were due to keep falling this year.

(Reporting by Eric Onstad; editing by John Stonestreet)