DiamonEx de-listed from BSE

MBONGENI MGUNI
Staff Writer | Wednesday September 8, 2010 00:00

DiamonEx, which operated Lerala Diamond Mine prior to its suspension early last year, ran into a financial gridlock following the collapse of diamond prices in the last quarter of 2008.

The diamond price collapse coincided with Lerala's first production from which DiamonEx directors were expecting to begin recouping their investment and settling creditors.

Yesterday, a BSE notice indicated that DiamonEx's counter was de-listed from the bourse with effect from Monday. The local exchange's daily market report for Monday and yesterday indicates that DiamonEx no longer appears on the venture capital board, where it had been listed.

Although according to BSE rules, the de-listing could be the result of DiamonEx directors requesting the move, sources say it is more likely the local bourse struck the Australian company off. 'In this case, it appears the BSE had a problem with the fact that the suspension of trade appeared indefinite,' says a source close to the latest developments. 'More information will become available during the week.'

The BSE's listing requirements state that 'when the listing of securities in a listed company is under threat of termination, the affected company shall be afforded the opportunity of making representations to the BSE committee in support of the continued listing of such securities, prior to the committee making any decision to terminate such listing.' The last information made available by DiamonEx says the company was engaged in a judicial tussle with a former creditor, which was holding back the finalisation of a takeover agreement with Fleming Asset Management Botswana. Fleming Botswana had proposed taking up an 80 percent stake in the diamond mine and investing millions in recapitalisation and debt settlement on behalf of DiamonEx.

A DiamonEx consultant, Mark Gray, told Mmegi earlier this year that work on the takeover deal was continuing and production was scheduled to resume in the last quarter of the year.

Gray was unavailable yesterday, while BSE officials declined to comment on the de-listing, saying the matter was 'still behind closed doors'.

However, an official announcement from the BSE is expected later this week.