LOM 0.00% 11.5¢ lucapa diamond company limited

bhp's diamond sale

  1. 2,369 Posts.
    Harry Winston still talking to BHP about Ekati acquisition

    The negotiations are dragging on and on, but Harry Winston is reportedly still interested in acquiring BHP Billiton's 80% stake in the Ekati diamond mine.

    Luxury jeweler Harry Winston is still in talks with BHP Billiton to buy the Ekati diamond mine in the Northwest Territories of Canada, the Financial Times has reported.

    "Harry Winston has secured bank financing for a possible deal, according to people familiar with the matter," the FT reported Monday.

    "But the process, originally slated to conclude by the middle of this year, is moving more slowly than expected and could fail to result in a deal," the FT warned.

    Located near Lac de Gras in the NWY, Ekati commenced commercial diamond production in October 1998. In recent years, Ekati production has been declining although it is still produces 11% of the world's diamonds according to value.

    In November 2011, BHP Billiton announced it was planning to sell its stake in the mine. While Harry Winston has a market value of C$1.1 billion, analysts have valued the Ekati mine at roughly $500 million to $750 million.

    Harry Winston CEO Bob Gannicott said in a Dec. 9, 2011, conference call that Ekati was of some interest although he feels the asset "is close to the end of its existing life."

    By February 2012, BHP CEO Marius Kloppers said that, without a buyer, BHP would "probably run that mine to closure ourselves in a manner responsible to the environment and community."

    In March of this year, private equity group, Apollo Global Management, expressed an interest in Ekati, according to a Bloomberg report. However, the FT said Apollo has now distanced themselves from the process.

    http://www.mineweb.com/mineweb/view/mineweb/en/page37?oid=156559&sn=Detail&pid=92730
 
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