Washington Companies buys Dominion Diamond for $1.2 billion

17.7.2017, 14:48 - eeppo

Canada’s Dominion Diamond Corp. (TSX, NYSE: DDC), the world’s third largest producer of rough diamonds by value, said Monday it has accepted The Washington Companies sweetened cash takeover bid presented last week.

The privately held Montana-based firm is offering $14.25 per share for all shares of the diamond producer, which means the acquisition is worth nearly $1.2 billion.

Dominion, which owns a majority stake in the Ekati mine and minority share of the nearby Diavik mine in Canada’s Northwest Territories, rejected Washington’s initial bid made privately on Feb. 21, saying it undervalued the company.

The firm announced earlier this year that its chief executive officer Brendan Bell was leaving the company due to personal reasons related to the company’s planned move of headquarters to Calgary from Yellowknife.

Over the past year, Dominion — the world’s third largest producer of rough diamonds by value — was hit by weak global diamond prices, as well as sudden challenges, including the death of the company’s founder, Robert Gannicott, and a fire at Ekati that suspended processing for three months and cost the miner around $20 million in repairs.

Dominion’s move to Calgary, which was expected to be completed in the coming months, follows a similar decision by De Beers Canada, which moved its headquarters from Toronto to Calgary in July last year.

More to come…

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