Rio Tinto did for Dominion Diamond cannot be ruled out, analyst says

|About: Dominion Diamond Corporation (DDC)|By:, SA News Editor

Dominion Diamond (DDC +4.2%) could accept a higher offer than Washington Companies’ $14.25/share buyout offer, but it is difficult to see who else might get involved aside from Rio Tinto (RIO +1%), who is the JV partner at DDC's Diavik mine, BMO analyst Edward Sterck writes.

Rio’s involvement cannot be ruled out, but management may feel that after finishing up a period of asset shedding, an initial deal in the diamond industry may not be digestible for its investors, Streck says.

Scotiabank has said previously that Rio could be “logically be interested” in DDC given significant synergy potential.

Source: Bloomberg First Word