Petra Diamonds buys interest in South Africa's Kimberley Mines

Petra Diamonds has acquired an interest in the Kimberley Mines in South Africa from De Beers Consolidated Mines Proprietary Ltd, in a consortium with Ekapa Mining for around $7.2m.

The diamond mining group will pay around $3.6m for a 49.9% stake in the mines, while Ekapa will own the rest.

The Kimberley Miners are anticipated to be cash flow positive in their first year of operation and Ekapa Minerals expects to produce around 700,000 carats per year in the first three years of operation, with revenue of around ZAR920m.

Chief executive officer Johan Dippenaar said: “We are delighted to have formed this consortium with Ekapa Mining in the acquisition of an interest in the Kimberley Mines, and we look forward to working with them to build upon their proven capabilities in tailings retreatment operations in Kimberley, as well as their strong local relationships.

“Together we are showing our commitment to shaping a new future for the diamond mining operations of Kimberley, to the benefit of our employees, shareholders and all stakeholders."

At 0847 GMT, Petra shares were up 5.7% at 67.80p.