Goodbye Tahoe (TSX: THO)! Hello Pan American Silver (TSX: PAAS)!

The big news today in the mining sector is another mega merger (mega for the silver sector) but in the silver sector. Pan American Silver is taking over the troubled Tahoe Resources and in particular its sweet sweet high grade Escobal Silver mine in Guatemala.

Here is the press release:

https://www.panamericansilver.com/investors/news-releases/detail/65/2018-11-14-pan-american-silver-and-tahoe-resources-create-the-worlds-premier-silver-mining-company

This comes after American management of Tahoe resources single-handedly tarnished the silver industry's reputation in the country by ignoring the existence of a local tribe, then recognized them, but it was too late, damage done. Local residents near the mine, greeted the company with a traditional tire fire and  the ritual slashing of tires on company vehicles as the company attempted to initiate a unsuccessful CSR program. 

This saw shares in Tahoe decline to a low of 2.90 (as of Nov. 13), from a 2014 high of ~30, albeit combined with a declining silver price as well.

This comes at a time when silver prices are dipping under 14 buckeroos per ounce, placing pressure on most silver miners, and this merger could be a part of a larger wave of M&A activity in the beaten to a pulp, hair pulling mining sector that refuses to give investors a return on capital, and is the second mega merger after Barrick and Rangold in the gold sector.

Pan American Silver is Ross Beatty's company and this move looks strategic, as after personal discussions with management from other silver producers, the industry is looking to improve its reputation and ensure its survival and operation viability in overseas jurisdictions.  Also, in the end this will be a positive move for Pan American Silver.