Theo Botoulas, MD, Diamond Core
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Diamond Core to merge with BRC
Allan Seccombe
Posted: Thu, 05 Jul 2007

[miningmx.com] -- JSE-listed Diamond Core could merge with Toronto’s BRC Diamond Resources to form a new company that will have a secondary listing in Johannesburg and land holdings in the Democratic Republic of Congo and South Africa.

The two companies have entered a pre-merger agreement, which is subject to a number of conditions. Under the agreement Diamond Core shareholders will receive one BRC share for every 24.5 in the South African company.

The merged company to be called BRC DiamondCore will have kimberlite projects in South Africa, which are in the bulk sampling phase, as well as advanced alluvial diamond exploration projects.

BRC shareholders will own 53%of the merged entity and Diamond Core shareholder the remainder.

“We have spent a considerable time in assessing all of the various parties active in diamond exploration in Africa in order to source a partner with whom to grow our business, and BRC easily stood apart from the rest in terms of a complementary management team and overall fit,” said Diamond Core CEO Theo Botoulas, who will be CEO of the merged entity.

Mike de Wit, who worked at De Beers for 29 years, will be president of BRC DiamondCore, and he will be based in Kinshasa. Botoulas will be based in Johannesburg.

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The four prime assets, which will be the focus of attention to bring in early cash flow, are three South African alluvial projects and the Kwango River project in the DRC.

Silverstreams on the northern bank of the Orange River in South Africa has a 670 tonnes per hour bulk sampling plant in operation and a drilling programme is underway. Previous test mining turned up good quality diamonds.

The Uitdraai project is contiguous to Silverstreams and a similar bulk sampling plant will be built there later this year.

The Kwango project consists of eight exploration permits covering 2,150 square kilometers. A bulk sampling programme is being designed.

The fourth project is De Kalk in South Africa, where a bulk sampling plant similar to Silverstreams will be built at the same time as the one at Uitdraai.

Once the South African Reserve Bank has approved the transaction the agreement will constitute a firm obligation. Diamond Core shareholders will meet in the fourth quarter of this year to vote on the deal. The company’s board will recommend the transaction if it receives a favourable opinion on the transaction.

Venmyn Rand will give its opinion on the deal.