Washington offers $1.1bn to acquire Canada’s Dominion Diamond
The Washington Companies has offered around $1.1bn to acquire Canadian diamond mining company, Dominion Diamond.
The company has unveiled plans to purchase all of the outstanding common shares of Dominion by paying $13.50 per share in cash, which represents a 36% premium to its closing stock price on 17 March.
The board of directors of Dominion continues to refuse the offer, after multiple discussions and concessions made by Washington over a three-week period.
Dominion said that its board confirmed that WashCorps does not have experience in the highly specialized diamond mining and marketing industry based on the presentation received from the company.
Dominion Diamond holds stake in two producing diamond mines, which are situated in the Northwest Territories in
The company is the operator of the Ekati diamond mine with a controlling stake, while it owns 40% interest in the Diavik diamond mine.
With sorting and selling operations in
Washington president Lawrence Simkins said: “We believe our proposal is extremely compelling and clearly in the best interests of Dominion and all of its stakeholders, including shareholders, customers, employees, and communities.
“If the transaction is consummated, it would provide Dominion shareholders with a substantial cash premium and offer superior value to that which Dominion could realize through ongoing execution of its plan or any other available alternative transaction.”
Dominion said: "Given the Company’s recent update on fiscal 2018 guidance and the complexity of Dominion’s assets, to indicate that diligence is confirmatory based on public records is highly questionable.
"It would also be entirely irresponsible of the company to allow a third party access to its confidential information without the benefit of customary agreements that protect the interests of shareholders and all of the company’s other stakeholders. "