Canada’s Dominion Diamond, the world’s third-largest diamond miner by market value, has agreed to be taken over by Washington Companies after the latter raised its all-cash offer to $1.2bn.
Washington, a group of privately held North American mining, industrial and transportation businesses founded by industrialist Dennis Washington, is offering $14.25 per Dominion share. That’s up from its initial offer of $13.50 a share, which was first pitched to the company in February and made public in March.
The sweetened offer represents a 44 per cent premium to Dominion’s closing price of $9.92 on March 17, the day before Washington disclosed its interest.
The deal still needs to be approved by two-thirds of Dominion’s shareholders and is conditional on the diamond miner having a minimum cash balance of US$150m if closing is on or before November 30, 2017, or US$200m if closing is after November 30, 2017. Canadian authorities would also need to give their approval for the transaction.
Dominion will be required to pay Washington a break fee of $43.9m if it decides to accept a rival offer. Inversely, Washington will have to pay Dominion a break fee of $70.2m if it cannot complete the deal due to funding failure of other circumstances.