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Alrosa board to consider acquiring diamond polisher Smolensk Kristall

PJSC Alrosa's supervisory board will vote Sept. 24 on a proposal to acquire state-owned diamond polisher Smolensk Kristall, according to a Sept. 17 release.

Once the deal is approved, a sale and purchase and agreement is expected by the end of this month. Key terms of the deal have been outlined in a decree signed by the government.

Kristall, which has about 1,800 employees, processes over 200,000 carats of rough diamonds per year, with 90% of feedstock supplied by Alrosa. Kristall's value is estimated at 1.89 billion Russian rubles, according to an independent appraiser.

In 2018, Kristall's output reached 105,700 carats while sales totaled 111,700 carats. Net profit and revenue reached 40.7 million rubles and 12.8 billion rubles, respectively.

Alrosa said the deal, which may make the company a stronger competitor to De Beers SA, will help it increase its share in the Russian market to 70% and cut production costs. Alrosa already started preparatory work to start joint operations in cutting and sales.

As of Sept. 16, US$1 was equivalent to 63.93 rubles.