Ekati Diamond Mine Misery underground pit
Ekati Diamond mine arial
PERTH, Australia, March 13, 2023 (GLOBE NEWSWIRE) -- Burgundy Diamond Mines has entered into a binding share purchase agreement to acquire 100 per cent of Arctic Canadian Diamond Company Limited’s assets, most notably the world-class Ekati Diamond Mine, and other interests in Canada’s Northwest Territories for total consideration of US$136 million (~A$209 million).
The proposed acquisition of Arctic Canadian Diamond Company is transformational for Burgundy – post completion, making Burgundy the largest ASX-listed diamond company and one of the largest listed diamond companies globally. The newly acquired Ekati Diamond Mine completes Burgundy’s strategy of becoming truly vertically integrated across the diamond value chain.
The Burgundy board and management team bring a great deal of experience which will support future mining projects and capitalize on the unrealized potential of Ekati.
Kim Truter CEO of Burgundy said.
“This is an exciting and transformational acquisition for Burgundy with potential to generate significant and growing returns for our shareholders. The acquisition of Ekati is complementary to Burgundy’s vertically integrated business model where it can directly produce rough fancy-coloured diamonds at Ekati and then cut and polish them in our facilities in Perth to go into high-end jewellery designs.”
The proposed acquisition will be considered by Burgundy shareholders where the equity will be raised via a conditional placement to raise up to US$150 million (~A$231 million). The placement will be subject to a shareholder vote at its general meeting, currently expected to take place in late April 2023.
Post completion, Burgundy will be focused on optimising Ekati’s mine performance and extending mine life through, among other things, underwater remote mining, assessment of the Jay Deposit and Fox Underground opportunities, and systematic exploration using newly applied machine learning (artificial intelligence) technology.
Burgundy has been purchasing high value fancy-coloured rough diamonds from Ekati since 2021, cutting and polishing them at its facility in Perth, Australia and selling them as luxury polished diamonds in high-end jewellery boutiques. As a result of the proposed acquisition, Burgundy is expected to produce significant volumes of rough diamonds for sale as well as significantly expand the cutting, polishing and sale of fancy coloured polished luxury diamonds.
Burgundy Executive Chair, Michael O’Keefe said,
“The transaction is a genuine game-changer for both Burgundy and Arctic Canadian. Having been involved with Burgundy since 2017, this exciting acquisition completes Burgundy's vertically integrated business model: bringing the world’s most beautiful diamonds to market from discovery through to design. We are confident that both Burgundy and Ekati have a very bright future and we expect this transaction will create significant value for all stakeholders.”