Precious metals miner Gold Fields has terminated its arrangement agreement with Canadian firm Yamana, after the company changed its recommendation on the Gold Fields all-stock offer in favour of a joint bid by Agnico Eagle and Pan American Silver.

Yamana is required to pay Gold Fields a termination fee of $300-million within two business days. Pan American full put up $150-million in cash to pay a portion of the fee.

“Gold Fields is disappointed by this outcome, and continues to believe that the transaction was a financially and strategically superior offer for shareholders of both Gold Fields and Yamana. Nonetheless, following Yamana’s change in recommendation, Gold Fields believes the most disciplined and prudent course of action to maximise Gold Fields’ shareholder value is to terminate the arrangement agreement,” the Johannesburg-based company said in a statement on Tuesday.

This comes as Yamana earlier in the day announced that it had entered into an arrangement agreement with Agnico Eagle Mines and Pan American Silver and told shareholders to vote against the Gold Fields offer.

Pan American and Agnico Eagle on Friday approached Yamana with a cash-and-share offer, valued at C$5.02 a share, or $4.8-billion.

Yamana has determined that the offer constituted a “superior proposal” to that of Gold Fields, which in May approached the company with an all-stock deal valued at $6.7-billion. The South Africa-based firm's share price has fallen since the transaction was announced.

Gold Fields had five business days to match the Agnico-Pan American offer, but stated on Monday that it would not make a counter offer, arguing that its board continued to believe its proposed transaction was superior to that of the Canadian companies.

With Gold Fields waiving its five-business day matching right, Yamana has entered into an arrangement with Agnico Eagle and Pan American.

In terms of the proposed joint offer, Pan American will acquire all the issued and outstanding common shares of the company and Yamana will sell certain subsidiaries and partnerships which hold its Canadian assets to Agnico Eagle. This will include the Canadian Malartic mine, allowing Agnico Eagle to consolidate its ownership in one of the world’s biggest gold mines.

Pan American previously said that the Yamana acquisition would establish it as a major precious metals producer in Latin America, with about 28.5-million to 30-million ounces of yearly silver production and about 1.1-million to 1.2-million ounces of yearly gold production.