Petra Diamonds sells rare blue gems to De Beers-Diacore partnership for $40.4m

Petra Diamonds Letlapa Tala Collection

PETRA Diamonds received a much needed cash boost after selling five blue diamonds, known as the Letlapa Tala collection, for $40.36m following a competitive tender process.

The blue diamonds, weighing 85.6 carats in total, were recovered from Petra’s Cullinan mine near Pretoria, in South Africa. They were sold as a suite of stones to a partnership between De Beers and Diacore, said Petra.

“The result of this special tender affirms the very high value placed on blue diamonds, which are undoubtedly one of nature’s rarest treasures,” said Richard Duffy, CEO of Petra Diamonds in a statement.

“We believe this to be the first time that five rough blue diamonds of significant size, colour and clarity have been offered for sale at one time and we are delighted that the collection has been bough in its entirety.”

Blue diamonds are rare and revered for displaying “exceptional transparency”, said Petra. The 12 carat Blue Moon of Josephine, a blue diamond recovered from Cullinan, fetched $48.5m in 2015, equal to $4m per carat. It remains the world record price per carat ever paid for a diamond.

The sale of the blue diamond collection is also a rare moment of sunshine for Petra this year after teetering on bankruptcy.

The company said in May that it would be unable to pay the coupon on $650m worth of bonds. The potential default led to Petra embarking on a radical restructuring of its balance sheet in which it swapped debt for shares equal to about 91% of its share capital. The company also ran a potential asset sale process.

Earlier this month, Petra reported a taxed loss of $223m, including $91.9m in impairments, for the 12 months ended June.  As of end-June, net debt totalled $696.6m, a $100m increase year-on-year, owing to lower sales and the capitalisation of interest on the $650m bonds.

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