UPDATE 4-Swatch buys Harry Winston jewellery arm for $750 mln

Mon Jan 14, 2013 8:15am EST
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* Acquisition includes $750 mln in cash, $250 mln net debt

* Mining arm renamed Dominion Diamond Corporation

* Deal seen as reasonably priced, Swatch shares rise 3 pct

* Harry Winston made famous by Marilyn Monroe

By Silke Koltrowitz

ZURICH, Jan 14 (Reuters) - Jeweller Harry Winston is selling its high-end watches-to-necklaces division to Swatch Group in a $750 million cash deal that expands the Swiss watchmaker's luxury offering and lets the Canadian group concentrate on its diamond mines.

Monday's deal reverses a 2004 acquisition which turned Harry Winston, the group that discovered what became Canada's Diavik diamond mine - now controlled by Rio Tinto - into a miner and jeweller.

The original mining arm is renamed Dominion Diamond Corporation after the sale of the Harry Winston luxury business, which started as a small jeweller in New York in 1932 and rapidly became a favourite with movie stars.

For Swatch, the deal is evidence of the benefits of strong Asian demand for watches, handbags and other high-end items that has given companies the firepower to expand their portfolio.   Continued...