Lev Leviev. Picture: GETTY IMAGES
Lev Leviev. Picture: GETTY IMAGES

Johannesburg/London/Windhoek/Lusaka — Billionaire, Lev Leviev, who made his fortune undercutting De Beers’ former diamond monopoly, has bought half of one of Africa’s biggest emerald mines.

Leviev bought into the Grizzly emerald mine in Zambia’s Copperbelt province, which borders the Democratic Republic of Congo, Kombadayedu Kapwanga, MD of Leviev’s Namibian unit, said by phone. The operation has been renamed Gemcanton Investments Holdings.

A spokesperson for Africa Israel Investments, a listed company in which Leviev is the biggest shareholder, didn’t return phone calls or e-mails seeking comment. A spokesperson at LLD Diamonds, Leviev’s jewellery business, didn’t return calls either. Leviev used his Israel-based diamond unit to purchase half of Grizzly, Kapwanga said, without providing further details.

The move into emeralds marks a change of course for Leviev. Born in Soviet Uzbekistan before fleeing to Israel in 1971, he worked as an apprentice in a diamond-polishing plant and established his own factory, striking deals with diamond-producing countries such as Russia and Angola.

He went on to own an 18% stake in Angola’s Catoca diamond mine, one of the world’s biggest, before selling it to Chinese investors to focus on the Luminas mine in Angola. As well as his jewellery company, Leviev controls a real estate empire from Moscow to New York through Africa-Israel Investments.

The Zambia company registry shows Gemcanton is jointly owned by two companies, British Virgin Islands-based Frango Finance and Wolle Mining. Grizzly was previously 85% owned by Abdoulaye Ndiaye, according to the Zambia Extractive Industries Transparency Initiative. Ndiaye is a Zambian who is originally from Senegal, and Grizzly has been digging emeralds in Zambia since 1997, according to Gemcanton.

Emerald prices have soared more than ten-fold in the past eight years, as top producer Gemfields plc sought to expand the market for them and boost advertising. Emeralds were previously mainly produced by artisanal miners, meaning there wasn’t a consistent enough supply for retailers to run production lines or advertise them. The company owns the Kagem emerald mine, Zambia’s biggest producer.

Gemfields CEO Ian Harebottle said the company has tried to contact Leviev. "I’ve written to them a few times and said ‘welcome to the area, let’s talk’. They’ve been non-responsive so far," Harebottle said in April. "Coloured stones offer a great opportunity with great growth potential. It was inevitable that someone else was going to look this way."

Pallinghurst Resources, which has a 47% stake in Gemfields, made an offer in May to buy the shares it doesn’t already own in the company. An independent Gemfields committee said the offer undervalued the company. Shares in Gemfields rose 3.7% by 1.11pm in London to trade at 35p.

Zambia produced 74.7 tonnes of emerald and beryl, a less-valuable grade of the stone, in 2016, a 42% increase from 52.8 tonnes in 2015, according to the finance ministry.

Bloomberg

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