The supervisory board of Russian diamond producer PJSC Alrosa approved the acquisition of state-owned diamond polisher Kristall, with closing anticipated in the first half of October.
The company said Sept. 25 that the board ordered CEO Sergey Ivanov to enter a sale and purchase agreement by the end of September under the conditions proposed by the country's Federal Agency for State Property Management.
Alrosa management will submit to the board an action plan for the development of Kristall, which was valued at 1.89 billion Russian rubles by an independent appraiser. Alrosa said the deal value is less than 1% of its net assets, and that the purchase price will not exceed the value of Kristall's net assets.
Kristall processes over 200,000 carats of rough diamonds per year, with 90% of its diamond feedstock supplied by Alrosa. The company expects the deal to help it compete with Anglo American PLC subsidiary De Beers SA.
As of Sept. 24, US$1 was equivalent to 63.86 Russian rubles.
