November 13, 2012 / 2:23 PM / in 5 years

BHP sells diamonds business to Harry Winston

LONDON, Nov 13 (Reuters) - Mining group BHP Billiton has agreed to sell its 80 percent stake in the EKATI diamond mine in Canada to miner and jeweller Harry Winston for $500 million in cash.

The sale, due to complete in the first quarter of next year, will result in an impairment of around $200 million after tax to the value of the asset.

BHP Billiton, the world’s largest miner, said last year it planned to sell all or part of its diamond assets, including the EKATI mine, as it focused on larger, long-life assets.

In December, BHP agreed to sell its majority stake in the Chidliak exploration project in northern Canada to its partner Peregrine Diamonds.

At the time, BHP said it was still reviewing its interest in EKATI, the cornerstone of its diamond business.

Analysts’ estimates of the price tag the mine could fetch had varied widely, from $500 million to over $1.5 billion.

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