Business Irish

Friday 22 September 2017

Desmond's €300m diamond firm to float new 'rock' project

Nick Webb

Nick Webb

Mountain Province, the €300m-valued Canadian diamond firm backed by billionaire financier Dermot Desmond, has announced plans to spin off a diamond project into a separate company to float on the Toronto stockmarket.

Kennady Diamonds owns a number of promising diamond exploration assets in northern Canada near Mountain Province's flagship Gahcho Kue project -- the world's largest and highest grade new diamond mine project. The exploration area had been mothballed for a number of years until reignited last year.

Shareholders in Mountain Province, in which Desmond owns a near 20 per cent stake, will receive shares in the new company on a pro-rata basis. Mountain Province will also fund Kennady's exploration work this year. Dublin businessman Des Sharkey holds a 7.5 per cent stake, while wealthy Scottish resources tycoon Harry Dobson is also a shareholder.

"The proposed spin-out of Kennady North is intended to deliver greater value to Mountain Province shareholders by unlocking the value of this highly prospective diamond project. The transaction will also enable Mountain Province to focus on its flagship Gahcho Kue Project while Kennady Diamonds focuses on advancing the 123 sq km Kennady North Project," said Patrick Evans, president and CEO last week.

Last August shares in Mountain Province soared when it emerged that the company had received "unsolicited" approaches from potential buyers. The company rebuffed the advances, claiming they were "premature" before final exploration results were received. It is likely the final exploration results may be received by Mountain Province by the end of June.

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