Gatos Silver enters amended agreements with Dowa regarding LGJV

Gatos Silver (GATO) announced that it has entered into amended and restated agreements with Dowa Metals & Mining regarding the Los Gatos Joint Venture. The amended agreements, which are effective on January 1, 2025, expand Gatos Silver’s management rights within the LGJV which will result in the company being able to fully consolidate the financial statements of the LGJV rather than accounting for its investment in the LGJV under the equity method of accounting as is currently required. The ownership interests of the company and Dowa in the LGJV are unchanged, at 70% and 30%, respectively. The amended agreements strengthen Dowa’s zinc concentrate offtake rights, including amending pre-defined commercial terms, which continue to be based on world benchmarks, and commitments regarding concentrate production and product quality. The amended agreements also update the terms for management services provided by Gatos Silver in its oversight of the LGJV, reduce supermajority voting requirements and provide the company with a new sole-funding right for significant mine or plant modifications or expansions, among other things.