Canadian miner Dominion Diamond Corporation issued a statement yesterday announcing the formation of, "a Special Committee to explore, review, and evaluate a range of potential strategic alternatives focused on maximizing shareholder value," and selling the company is one of those alternatives. The announcement follows events last week when Dominion became the target of an unsolicited $1.1 billion approach by U.S. billionaire Dennis Washington, a $13.50 a share takeover proposal from The Washington Companies it rebuffed as the terms to advance talks were unacceptable and the "opportunistic" bid undervalued the company. While Dominion did not like the terms, its share price certainly did not notice, climbing 3.4 percent on market speculation that the company would be the target of further interest.
Subsequent to these developments, Reuters reported that Dominion and fellow Canadian diamond miner Stornoway Diamond Corp had held talks about a potential merger in recent months. Speculation today was that Russian diamond miner ALROSA might be interested in buying Dominion, news that ALROSA's new Chief Executive Sergey Ivanov summarily dismissed: "We are not interested at this stage," Ivanov said in an emailed response to Reuters.
Dominion's statement adds: “While the Board of Directors remains confident in the Company’s long-term strategic plan and the opportunity it provides to enhance value for all shareholders, we are open to exploring all strategic alternatives that are in the best interests of the Company and its stakeholders,” said James Gowans, Chairman of the Board of Dominion Diamond Corporation. “The Board is committed to maximizing shareholder value through a fair and open process and we look forward to engaging constructively with all parties.” The Board of Directors has not set a timetable for this process nor has it made any decisions related to strategic alternatives at this time, and there can be no assurance that the exploration of strategic alternatives will result in any transaction or change in strategy.