DELIVERING DISCIPLINED GROWTH
Third largest primary Gold Producer in North America
Message: Acquires Interest in Diavik Diamond Mining Partnership
| March 19, 2009 |
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Kinross Acquires Interest in Diavik Diamond Mining Partnership
Also buys 19.9% equity stake in Harry Winston |
| TORONTO, ONTARIO--(Marketwire - March 19, 2009) - Kinross Gold Corporation (TSX:K)(NYSE:KGC) ("Kinross") announced today that it has signed a subscription agreement with Harry Winston Diamond Corporation (TSX:HW)(NYSE:HWD) ("Harry Winston") further to which Kinross will make a net investment of US$150 million in exchange for an indirect interest in the Diavik Diamond Mine in Canada's Northwest Territories and a 19.9% shareholding in Harry Winston. The agreement consists of two components. The first component is a subscription for a minority 22.5% interest in the partnership that holds Harry Winston's 40% interest in the Diavik diamond mine joint venture operated by Rio Tinto. The net effective subscription price is US$104.4 million. The second component is an equity private placement (subject to regulatory approval) of 15.2 million common shares of Harry Winston at a price of US$3.00 per share, for a total investment of US$45.6 million, giving Kinross a 19.9% interest in Harry Winston. Following the closing of the transaction, Kinross will be offered a seat on the Harry Winston board of directors. Harry Winston will continue to market all of the partnership's share of diamond production from the Diavik mine, including the portion attributable to Kinross' interest. In addition, the parties have agreed to consider future investment opportunities in the diamond mining industry on a case-by-case basis. "We are acting on a rare opportunity to acquire a stake in one of the world's great diamond mines, operating in northern Canada, with a long mine life and a record of strong cash flows," said Kinross President and CEO Tye Burt. "For Kinross, this represents a strategic investment that is accretive and has the potential to create excellent long-term value for our investors." "We view diamond mining as complementary to our core business of gold mining, which remains our primary focus. We believe that, as with gold, the long-term supply and demand fundamentals for high-quality diamonds are strong," Mr. Burt said. "Harry Winston occupies a unique and respected place in the global diamond business and we look forward to working with them in the future." Subject to customary closing conditions, the agreement is expected to close within approximately two weeks. Kinross and Harry Winston will host a conference call for analysts, investors and other interested parties on Thursday, March 19, 2009 at 4:45 p.m. ET, followed by a question-and-answer session. To access the call, please dial: North America: 1-866-543-6405; passcode 65480867 International: 1-617-213-8897; passcode 65480867 You may also access the conference call on a listen-only basis at: www.kinross.com or http://investor.harrywinston.com A telephone replay of the call will be available one hour after the call until 11:59 p.m. ET on April 3, 2009. To access the call replay, please dial: North America: 1-888-286-8010; passcode 40769914 International: 1-617-801-6888; passcode 40769914 You may also access a replay of the call at: www.kinross.com or http://investor.harrywinston.com |
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