Dominion Restarts Rough Sales

RAPAPORT… Dominion Diamond Mines has sold $46 million worth of rough at its first diamond sale since March, enabling the company to repay some of its debts amid insolvency proceedings.

The miner expects to sell approximately $8 million of smaller rough in a second sale this week. If it achieves that total, the combined revenue from the two sales would exceed Dominion’s reserve price of $52 million for the goods, though the company had considered their book value to be $58 million, according to a court filing by Dominion last week.  

“Recently, access to the international diamond market has gradually begun to reopen and provide opportunity for [Dominion] to realize value on their diamond inventory,” the document stated.

Dominion had been unable to sell its $180 million in inventory during the Covid-19 pandemic as the goods were “trapped” in various stages of the marketing and sales cycle while travel and trade restrictions were in place, said Kristal Kaye, Dominion’s chief financial officer.

The revenue generated by those sales will be used to pay down the debt Dominion has accrued.

Dominion also requested an extension of its insolvency protection order to November 7, when it is set to close a buyout deal of its assets by affiliates of its owner, the Washington Companies. The current order is scheduled to expire on September 28.

Image: Rough-diamond sorting. (Dominion Diamond Mines)