RAPAPORT... The Russian government has approved Alrosa’s acquisition of Kristall,
the diamond manufacturer said Monday.
Alrosa has hired Maxim Shkadov, Kristall’s director general,
to work on integrating the two companies, Kristall added. Alexey Romankov,
Kristall’s deputy director general and production director, will take over as
acting general director at the cutting firm until the next shareholder meeting.
The merger decision is still not final as the Federal Agency for State Property Management, another government agency, is
currently assessing the deal, Alrosa noted.
“Once the evaluation is ready and the price is known,
the supervisory board of Alrosa will make the final decision whether the
integration is appropriate or not,” an Alrosa spokesperson told Rapaport News Monday.
Rumors of a takeover first surfaced in April as Alrosa sought to expand its polished production and help differentiate
its products in the market. The Russian miner sees operational synergies
between the companies, Dmitry Amelkin, Alrosa’s head of strategic
projects and analytics, told Rapaport News last month.
Kristall, which is based in the Russian city of Smolensk, sources some of its rough diamonds from Alrosa, as a member of the Alrosa Alliance program, and is also a De Beers accredited buyer. It cuts about 300,000 carats every year, and generates annual revenue of approximately $200 million, according to a May Reuters report. That makes it more than twice the size of Alrosa’s polished division, which recorded sales of $96.9 million in 2017.
Image: Kristall polishing factory. (Kristall)
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