Tychean Resources, a company currently holding a 15 percent stake in the Tanami gold project in Australia’s Northern Territory, has made a lateral move to transform itself into a diamond-based, vertically integrated operation, by announcing the planned acquisition of a 74 percent stake in South African-based Blom Diamonds, owned by current World Federation of Diamond Bourses (WFDB) Chairman Ernest Blom.
The deal is set to go through in 90 days, subject to the approval of the Australian Stock Exchange (ASX). Blom is slated to become the managing director of the new entity and will remain based in Johannesburg, where he is currently located.
Tychean Resources, based in Adelaide, said the acquisition was the culmination of “significant efforts in securing a cornerstone project” that would help it transform “into a vertically integrated diamond-focussed company”.
The Blom Diamonds umbrella encompasses Blom Diamond Cutting Works and Ernest Blom Diamonds, which together have a footprint in trading, beneficiation, and the cutting and polishing of diamonds.
Through the acquisition, the company said in a statement to the Australian Stock Exchange, it would “have the necessary experience to combine the full value chain of diamond exploration, production, trading, beneficiation, cutting and polishing, in turn creating a vertically integrated investment vehicle.”
The deal involves the issue of 68.45 million Tychean shares to Blom, and is also dependent on several performance milestones over the next three years.