Harry Winston Diamond Corp. (TSX:HW,NYSE:HWD) announced that it has agreed to sell Harry Winston Inc., its diamond jewelry and timepiece component, to The Swatch Group Ltd. for US$750 million. The Swatch Group will also take on up to US$250 million of pro forma debt.
Robert Gannicott, chairman of Harry Winston, commented:
At the time that we purchased the Harry Winston brand, resource investment opportunities for diamonds were rare and expensive following the euphoria of the Canadian diamond discoveries, and the involvement of the large international mining companies. The Harry Winston brand was competitively priced compared with its peers and we could bring diamond expertise and strategic connections to enhance value. Today there is a range of diamond resource opportunities while the value of heritage luxury brands has increased dramatically. This transaction represents a sound return on our original investment. It will leave us well equipped to realize upstream opportunities in an environment where cash has become a strategic resource while preserving and expanding our relationship with the downstream diamond business.