Namibia: Trustco Looks to Sierra Leone for Diamonds

Trustco Holdings and a subsidiary within the group, Huso Investments Limited are looking at West Africa, particularly Sierra Leone for diamonds, with the group announcing this week that it had entered negotiations with an undisclosed entity. Huso Investments is yet to be fused into the Trustco group, owing to outstanding issues including shareholder approval. Huso Investments in its current form is owned by Trustco man, Quinton van Rooyen and his immediate family.

"While the Huso transaction has not yet closed, the company wishes to advise shareholders that Huso has entered into advanced negotiations with a target company in Sierra Leone relating to a potential partnership for a geo-economic evaluation, development and exploration of a diamond exploration license as secured by the target company in June 2015," Trustco announced in a cautionary statement issued by the Namibian Stock Exchange late on Thursday this week. "Should Huso and the target company be satisfied with the outcome of an independent due diligence review, they will use their best endeavours to negotiate and agree to a definitive agreement. The outcome of the independent due diligence is expected within 15 business days," Trustco said.

Huso Investments has interests in a license for a diamond processing and polishing factory and is currently owned by van Rooyen. It also holds the van Rooyen family's interests in the defunct Toscanini diamond prospect in the Skeleton National Park. Explaining the rationale behind the purchase of Huso Investments by Trustco, the company told the Economist last year that it will create a natural foreign exchange hedge for Trustco, adding that it is expected to create shareholder value to the shareholders of Trustco. "Opportunities in the diamond sector are very scarce, especially a vertically integrated business model within the diamond value chain." Added Trustco then "more than 2500 Namibian shareholders in particular will benefit directly from the exploitation of the natural resources of Namibia. Local beneficiation will stimulate this sub-sector due to the vertically integrated model of Huso."

Source: Namibia Economist.

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