Harry Winston seen near Rio Tinto diamond mine deal

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Harry Winston Diamond (NYSE:HWD) is in advanced talks to purchase Rio Tinto’s (NYSE:RIO) 60% stake in the Diavik Mine, two industry sources told dealReporter.

Canadian diamond retailer Harry Winston owns the remaining 40% of the mine, which is located in Canada’s Northwest Territories. Rio Tinto has been exploring options for its diamond interests since March.

One of the industry sources said it was his understanding that Harry Winston and Rio Tinto are in exclusive discussions. It is unclear how long the parties have been in exclusivity, but the same source estimated the period may have begun two weeks ago.

Both industry sources said Rio Tinto’s 60% stake in Diavik could fetch at least CAD 600m. The sources added that Harry Winston intends to issue debt to fund the deal.

According to a media report last month, Harry Winston CEO Bob Gannicott said the company could exercise its right of first refusal to pick up Rio’s 60% interest in Diavik.

Harry Winston declined to comment. Rio Tinto was not immediately available for comment on Thursday evening.

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