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DDC - Dominion Diamond News Story

$14.24 -0.0  -0.1%

Last Trade - 01/11/17

Sector
Basic Materials
Size
Micro Cap
Market Cap £n/a
Enterprise Value £n/a
Revenue £497.4m
Position in Universe th / 6841

EXCLUSIVE-Washington Companies in talks to buy Canada's Dominion Diamond -sources

Fri 14th July, 2017 5:50pm
(Adds Dominion's TSX trade halt, background on sales process, 
other potential bidders; updates stock prices) 
    By Susan Taylor and John Tilak 
    TORONTO, July 14 (Reuters) - Dominion Diamond Corp  DDC.TO  
of Canada, the world's third-largest diamond producer by market 
value, is in advanced and friendly talks with the Washington 
Companies on a sweetened cash takeover bid, sources told Reuters 
this week. 
    Negotiations are currently focused on the two sides settling 
on a price, said the sources, who declined to speak publicly on 
the matter. A deal could be announced within weeks, they said. 
    Trade in Dominion shares on the Toronto Stock Exchange was 
halted pending news. The stock had gained as much as 4.74 
percent following Reuters' report on the talks.  urn:newsml:reuters.com:*:nL1N1K5119 
    The U.S.-listed shares  DDC.N  soared as much as 6 percent 
to $13.60, before edging back to $13.44, or up 5.3 percent, in 
early afternoon trade in New York. 
    It was unclear how much Washington Companies had increased 
its initial unsolicited cash proposal, of $13.50 a share, which 
was the catalyst for Dominion to formally put itself up for sale 
in March.  urn:newsml:reuters.com:*:nL3N1H43PI 
    At $13.50 a share, the acquisition would be worth nearly 
$1.09 billion (C$1.38 billion). 
    Dominion, which owns a majority stake in the Ekati mine and 
a minority share of the nearby Diavik mine in Canada's Northwest 
Territories, had rejected Washington's initial advance, saying 
it undervalued the company and that the terms of proposed talks 
were unacceptable. 
    Washington Companies is a group of privately held North 
American mining, industrial and transportation businesses 
founded by industrialist and entrepreneur Dennis Washington. 
    Washington Companies declined to comment, while Dominion was 
not immediately available for comment. 
    Washington and other interested parties signed 
confidentiality agreements to review company data, Dominion said 
on May 1.  urn:newsml:reuters.com:*:nFWN1I2080 
    The sales process, a rarity in the tightly-controlled global 
diamond industry, attracted the Canada Pension Plan Investment 
Board (CPPIB), sources told Reuters. 
    CPPIB, Canada's biggest public pension fund, was joined in 
the data room by small Canadian producer Stornoway Diamond 
 SWY.TO . 
    It was unclear if Stornoway, which held merger talks with 
Dominion earlier this year, or CPPIB had submitted formal bids. 
 urn:newsml:reuters.com:*:nL2N1GX1X2  urn:newsml:reuters.com:*:nL1N1ID0Z0 
    CPPIB looked at Dominion's books in 2015, sources said, when 
the miner worked with investment bank Rothschild & Co to 
consider ways to boost shareholder value, including a potential 
sale. 
    There has been ongoing market speculation that diversified 
global miners Rio Tinto  RIO.L   RIO.AX  and Anglo American 
 AAL.L  were also eying Dominion.  
    Rio operates and holds a 60 percent stake in Diavik, while 
Anglo's De Beers unit operates the Gahcho Kue diamond mine in 
the Northwest Territories. 
    Dominion hired Toronto-Dominion Bank  TD.TO  earlier this 
year to run the sales process. 
 (1 Canadian dollar = $0.7898) 
 
 (Reporting by Susan Taylor and John Tilak; editing by Denny 
Thomas, G Crosse) 
 ((susan.taylor1@thomsonreuters.com; +1-416-941-8083; Reuters 
Messaging: susan.taylor1.thomsonreuters.com@reuters.net)) 
 
Keywords: DOMINION DIAMOND M&A/WASHINGTONCOMPANIES (EXCLUSIV
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