Sunday, July 22, 2007

Diamond Rose shines on debut

19 April 1997 By Christine Lacy

Joe Gutnick’s sister Pnina Feldman led Diamond Rose to a stunning debut when her small gemstone hopeful finished its opening day valued at $159 million.

The shares opened at $1.51 and, within an hour, the hype surrounding the float had driven them to a staggering high of $1.75.

This represented a nine-fold increase on their 20c issue price.

Shares in the fledgling miner ended the day at $1.29, valuing Ms Feldman’s personal 57.5 per cent stake in the miner at a staggering $91.59 million.

The company, which has no proven tenements, is capitalized at $156.1 million, compared with its $10 million initial public offering. Outside the Sydney exchange, Ms Feldman, flanked by four daughters, six rabbis and grand-daughter Rose said she was ecstatic with the debut, adding: “I’ll be even happier when we find diamonds.”

But Ms Feldman, whose motivation in floating the miner is to find the 12 gemstones of the breastplate worn by the High Priest in the Temple of Jerusalem 3000 years ago – as described in the Bible – is unable to sell her 57.5 per cent stake.

Under stock exchange listing rules, she is prevented from selling her shares for two years. Her recent bid to gain an exemption from the restriction failed.

High-profile Melbourne miner Diamond Joe Gutnick yesterday declined to confirm whether he had been allocated a stake in Diamond Rose.

But the miner’s top 20 shareholders boasts other high-profile investors.

Perpetual Trustees, which landed four million shares in the 10 million shae float, is believed to have crystallized a $3.5 million profit on its $800,000 investment, selling 3.9 million shares at $1.10 each.

James Packer and the George Soros group are also believed to have landed a stake in the hotly sought-after offering.

The debut was reminiscent of that of Me Gutnick’s diamond hopeful, Astro Mining, which last September was reinstated to the boards at a 20-fold premium to its 20c placement price.

On its first day of trade, Astro finished at $4.10, booking Mr Gutnick a $70 million profit. Yesterday, Astro closed steady at $3.60.

However, his sister has now come close to upstaging the St Kilda mining magnet in the diamond stakes, but Joe is also building one of Australia’s biggest gold empires.