US-based Coeur Mining has agreed to acquire Canadian firm SilverCrest Metals for around $1.7bn, creating a "leading global silver company".

The move comes amid the two companies’ efforts to secure reserves to meet the surging silver demand, reported Reuters.

Under the deal, US-based SilverCrest shareholders will receive 1.6022 Coeur common shares for each share held in the company. This values SilverCrest at approximately $11.34 per share.

The combined entity is expected to produce around 21moz of silver in 2025, with the US-based mines contributing 56% of the revenue.

It is also expected to produce about 432,000oz of gold next year.

The addition of SilverCrest's high-grade Las Chispas mine in Mexico is expected to complement Coeur's portfolio with low-cost, high-margin production, having already sold around 10.25 million silver equivalent ounces in 2023.

Financially, the SilverCrest acquisition is set to significantly boost Coeur's EBITDA and free cash flow, with projections of $700m and $350m respectively for 2025.

Upon completion of the deal, SilverCrest CEO N Eric Fier and another director from SilverCrest will join Coeur's board.

Coeur chairman, president and CO Mitchell J Krebs said: “The acquisition of SilverCrest creates a leading global silver company by adding low-cost silver and gold production and significant free cash flow to our rapidly growing production and cash flow driven by the recent expansion of our Rochester silver and gold mine in Nevada.

“Together with SilverCrest’s large and growing cash balance and no debt, our balance sheet is expected to be materially strengthened on day one.”

Coeur's board of directors has unanimously approved the transaction and recommends shareholders vote in favour of the merger.

Subject to conditions, the transaction is expected to close late in the first quarter of 2025.