ALROSA may acquire 'financially-challenged' Kristall
The diamond industry shakeout continues as Russian diamond miner ALROSA said today it is considering acquiring Kristall.
According to information provided by ALROSA, the Kristall diamond factory is a leading polished diamonds manufacturer in Russia and Europe. The company was founded in Smolensk in 1963 and is 100% owned by the state through the Federal Agency for State Property Management (Rosimushchestvo).
Kristall is valued at $29 million (RUB1.886 billion) according to an independent appraiser.
"On the back of the increasingly complex economic environment, Kristall has been going through some financial challenges in recent years," said Sergey Ivanov, ALROSA's CEO in a news release.
"However, the business maintains its output volumes being Russia's largest producer and exporter of polished diamonds, boasting rich heritage, state-of-the-art equipment, and extensive expertise in rough diamonds cutting."
The acquisition will go before ALROSA's board on later this month.
"We are quite optimistic about the integration prospects and have already embarked on preparatory work to start joint operations in cutting and sales. We expect that our efforts to merge our cutting facilities will help reduce production costs and, subject to a favorable market environment, take up a considerable share of the market for best in class polished diamonds."
Earlier this month Osisko Gold Royalties announced that it would acquire Stornoway Diamond, which put itself into creditor protection after the diamond market slumped.