Dermot Desmond puts €8.4m into Kennady Diamonds private placement
Billionaire financier Dermot Desmond has spent €8.4m buying shares in Toronto-listed Kennady Diamonds as part of a private placement. The IFSC-based dealmaker bought 4.5 million shares last week. "The shares have been acquired for investment purposes," according to a Kennady statement.
Desmond and his Bottin investment company increased their stake to 24.6pc of the €95m-valued listed company.
Kennady raised €32.5m in two tranches, using a non-brokered private placement which closed last week. Kennady's share price has more than doubled in the last three years, although it remains well off a recent peak, which was hit last September.
Kennady Diamonds Inc controls 100pc of the Kennady North diamond project, located in Canada's Northwest Territories. It is beside the Gahcho Kue Diamond Mine, a joint venture between Beers Canada and the Dermot Desmond-backed Mountain Province Diamonds. Kennady is in the process of proving up a promising and potentially diamond-rich tract of land.
"The proceeds from the private placement will be used to fund all aspects of the company's Kennady North Project until the end of 2017, including drilling and bulk sampling, evaluation, a preliminary economic assessment, a definitive feasibility study, permitting and for general corporate purposes," according to Kennady.
Desmond has made a big bet on an impending shortage of diamonds in the world. The Gahcho Kue project is the "world's largest and richest new diamond mine". There has not been a major new diamond mine in almost two decades.
Desmond owns a 24pc stake in Mountain Province, which owns a 49pc stake in the Gahcho Kue mine. The mine is currently under construction, with first production expected in the second half of 2016.
The mine is "progressing according to plan and budget, with the overall project more than 70pc complete," according to the company.
Sunday Indo Business