Pan American Silver (PAAS) shares plummeted 10.97% in Monday's intraday trading, following the announcement of a $2.1 billion acquisition deal for MAG Silver (MAG). The significant drop reflects heightened investor concerns about the terms and implications of this major corporate move.

According to the late Sunday announcement, Pan American Silver has agreed to acquire MAG Silver in a cash and stock transaction. The deal values MAG Silver at $20.54 per share, comprising $500 million in cash and 0.755 Pan American shares for each MAG share. Upon completion of the acquisition, MAG shareholders are set to own approximately 14% of Pan American shares.

The market's negative reaction to the news can be attributed to several factors. Investors appear concerned about the acquisition price, potential dilution of existing Pan American shares due to the stock component of the deal, and the integration risks associated with such a large merger. The transaction is subject to approval by two-thirds of MAG shareholders at a special meeting expected in July, as well as clearance under Mexican antitrust laws and other regulatory approvals. The companies anticipate the deal to close in the second half of the year, pending these approvals.