Canadian mining giant Dominion Diamond Corporation has been acquired by Washington Companies for $1.2 billion.
Washington has agreed to buy all shares in Dominion for $14.25 each in cash. Last week, Dominion’s share price rose four per cent, and has skyrocketed by 40 per cent since Washington expressed first expressed interest in the deal four months ago.
Around March, it was reported that Dominion held merger talks with Stornoway Diamond Corporation, another Canada-focused miner. The Canada Pension Plan Investment Board had also emerged as a potential suitor.
“The board unanimously agrees that this offer represents the best option available to Dominion shareholders, and recommends that shareholders vote in favor of this transaction,” says Dominion chairman Jim Gowans.
Washington plans to keep the Canadian miner as a standalone business. What’s more, it will appoint Dominion a new, Canada-based CEO, as well as keep the company’s Canadian headquarters and promote the CanadaMark brand.
Dominion completely owns the Ekati mine and has a 40 per cent stake in the Diavik mine, both of which are located in Canada’s Northwest Territories.
“We are excited to work with their team to extend the mine life of the Ekati mine and continue partnering with Rio Tinto in the operation of the Diavik mine, while maintaining long-term employment for Dominion employees,” says Washington president Lawrence Simkins.