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De Beers sweetens bid for Canadian diamond mine

TORONTO — Global diamond industry leader De Beers took a step Monday toward expanding production into Canada by increasing its takeover offer for a company with the rights to the nation's first underground diamond mine.

The board of directors of Winspear Diamonds Inc. unanimously supported the new De Beers offer of $206 million, or $3.40 per share. The Winspear board previously rejected the initial De Beers offer of $175 million.

Winspear holds a 67 percent interest in the Snap Lake project in the Northwest Territories, which would be Canada's first underground diamond mine, pending regulatory approval.

Shareholders have until Aug. 25 to accept the new De Beers offer. De Beers needs more than 50 percent of the shares and already has the 9.4 million shares -- about 15 percent of the total -- controlled by the Winspear board.

"We are pleased that De Beers recognizes the value and potential of the Snap Lake diamond deposit,'' said Randy Turner, the Winspear chief executive officer.

Winspear's board also agreed to refrain from seeking competing offers and gave De Beers the right to match any other offer.

Last week, Winspear announced that the Snap Lake project was projected to produce more than double the initial estimated output.

De Beers is an international diamond mining group that has several Canadian projects in the advanced states of exploration. The amount offered for Winspear would be its largest North American investment, and Snap Lake would be its first diamond-producing mine outside of southern Africa.

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