JOHANNESBURG (Business Day) -- Diamond miner and explorer Namakwa Diamonds [LSE:NAD], founded 28 years ago, traded 1.4% below its placement price on Wednesday, its first day of unrestricted trade on the London Stock Exchange (LSE) main board.
Restricted trade in the shares, a mechanism to stabilise the price, began last Friday.
Unrestricted trade began at 178.5 pence versus the 181 pence at which the stock was placed with institutions to raise $185 million.
CEO Nico Kruger said the listing was an important day for Namakwa. "The admission of our shares to trade on the LSE's main market and the proceeds of the successful IPO (initial public offering) mean that we can focus on delivery of our exciting growth plans," he said.
Namakwa Diamonds was founded in 1979 as a diamond trading business. It expanded into cutting and polishing, and in 2004 bought its first diamond mine to secure supply.
Now it produces about 6,000 carats a year from its South African mines, and about a third of this is cut and polished in South Africa.
Apart from its mines in North West, Namakwa holds exploration properties in South Africa, Namibia, Angola and the Democratic Republic of Congo.
It focuses on alluvial mining, which typically requires less capital and delivers higher-value stones than kimberlite mining. Namakwa's diamond resource at end-September was estimated at about 16.6 million carats.
The funds raised from listing would be used to expand production to 100,000 carats a year by 2009, Kruger told Miningmx last month. Namakwa also plans to develop new mines in the Congo and Namibia.
"We believe we are strongly positioned to capitalise on a number of consolidation and growth opportunities in southern Africa," he said last week.
The company was 25% owned by the Kruger family before the listing. Directors and employees will hold 19% after the issue of new shares but before the exercise of the overallotment option, according to its "intention to float" document.
