THE DIAMOND PAGE — Diamond Fields gains foothold in Namibia

Diamond Fields International (DFI) has acquired all the subsisting rights of BHP Minerals International and Benco to gain an interest in the Luderitz diamond mining concessions, off the coast of Namibia.

In exchange, DFI will issue to Benco 13.7 million shares, which represent 11.6% of the issued and outstanding DFI shares. Some or all of these shares may be transferred by Benco to BHP, as mutually determined by those companies.

For as long as their combined shareholdings in DFI are equal to, or greater than, 10%, BHP and Benco will be entitled to maintain one representative on DFI’s board.

The rights of BHP and Benco to acquire an interest in the Luderitz concessions arose pursuant to a 1994 joint-venture agreement among those two companies and a wholly owned subsidiary of DFI. According to that agreement, BHP and Benco could have earned a 50.1% joint-venture interest in the concessions by spending US$10 million on exploration and completing a feasibility study.

DFI retains a 100% interest in the Luderitz concessions, and BHP and Benco have ceded their rights to acquire a direct interest in the concessions in exchange for a significant equity interest in DFI.

DFI is privately owned and was set up to hold the diamond assets belonging to Diamond Fields Resources (DFR) at the time it was bought out by Inco (N-T) in 1996. Its major shareholders are former DFR co-chairmen Robert Friedland and Jean-Raymond Boulle, and former DFR shareholder Teck (TEK-T).