De Beers sells Kimberley mine for $7.2 million

Rob Bates

In a historic deal that ends a century of involvement in the town that launched its empire, De Beers has sold its Kimberley mine to a consortium that comprises Petra Diamonds and Ekapa Mining for $7.2 million.

Ekapa will own 50.1 percent of the venture, which includes associated tailings; Petra, which also owns the Kimberley underground mines, will own 49.9 percent.

In a statement, De Beers said it had explored a variety of options to extend the Kimberley, South Africa–based mine’s life beyond 2018 but decided it needed a better-suited company. It received more than 70 expressions of interest when it listed the mine for sale earlier this year, it said.

The group expects the mine, nicknamed The Big Hole, to produce 70,000 cts. per year. The tailings could yield another 2.4 million cts., and further treatment could produce another 4.4 million, a statement said.

Petra previously purchased several other former De Beers mines, including the Cullinan, Finsch, and its assets in Tanzania. It expects the mine to be cash-flow positive its first year.

The sale is in many ways historic, as the Kimberley is considered the birthplace of the diamond industry, and the mine was the first to be controlled by De Beers Consolidated Mines (DBCM) when it formed in 1888.

Read full article

Source JCK Online