On Monday, First Majestic Silver shares fell more than 10% on news it had inked a friendly, nearly all-share takeover with Silvercrest Mines. It seems the prospect of a bigger silver mining company, with more shares out, drove shareholders to dump shares amid an increasingly bearish precious metals market.

Still, some analysts agreed with First Majestic reasoning that the takeover could buoy First Majestic cash flow and improve its operating cost outlook.

“I think it is a good deal for First Majestic as it is free cash flow accretive and [comes with] a lower cost asset – so good on both of those items,” Desjardins analyst Michael Parkins said by email. “The mine life looks good based on the reserves and the balance sheet of First Majestic will also improve on a net cash basis.”

The deal adds another mine in Mexico to First Majestic’s stable of six operations in that country. Silvercrest owns the Santa Elena gold-silver mine that is to produce some 4 to 5 million ounces silver-equivalent (gold is a major component) over the next few years. The mine plan shows declining production, falling to under 4 million ounces silver after that to 2022.

First Majestic estimated production next year will grow by about 5 million ounces silver equivalent to 16.8 million ounces silver equivalent.

Ownership-wise the combination mirrors the reserve base of both miners. Silvercrest is to own 21% of the combined company and brings a similar amount of silver-equivalent reserves to the table, 19 million ounces versus First Majestic’s 101 million ounces.

Silvercrest forecast operating costs per silver-equivalent ounce beats out First Majestic somewhat. Silvercrest estimates all-in sustaining costs in 2015 just over $12/oz silver-equivalent versus First Majestic’s estimate for this year between about $14/oz and $15.50/oz.

So, if 2015 turns out as expected, First Majestic’s all-in sustaining operating costs, with Santa Elena on board, could come down slightly and, assuming the price of silver doesn’t drop much further, boost cash flow.

Meantime, First Majestic as a silver miner will gain in the ranks of silver producers (assuming silver-equivalent production), growing production in the near future by as much as 45%. It will potentially exceed Coeur Mining production next year, which is expected to produce about 15.8 million ounces silver in 2016 or about 1 million ounces less than a combined First Majestic and Silvercrest.