Indian jeweller Rajesh Exports buys refiner Valcambi for US$400m

[MUMBAI] Indian jewellery firm Rajesh Exports Ltd said on Monday it has bought Valcambi, the world's largest gold refining company, in an all-cash deal worth US$400 million as it looks to secure raw material supplies at competitive prices.

After the acquisition, the world's largest gold jewellery maker will expand capacity at it's India-based refinery, Rajesh Mehta, the company's chairman told Reuters.

Rajesh Exports said in a statement it sealed the purchase after a global sales process conducted by Valcambi's existing owners led by Newmont Mining Corp. "It will help Rajesh Exports in securing raw material like dore," said analyst Bhargava N Vaidya of BN Vaidya Associates. Dore is a semi-pure alloy of gold and silver. "Valcambi has world class refining technology. So it will help the Indian company in setting up or expanding refining capacity if it wants," he added.

India is the world's biggest consumer of gold, with annual demand hovering around 900 tonnes per year.

Over the past three years, Swiss-based Valcambi has on average refined and sold 945 tonnes gold and 325 tonnes silver per year, the statement said.

Valcambi's senior management team, including chief executive Michael Mesaric, will join Rajesh Exports to aid the ownership transition and future expansion, the Indian company said.

Mesaric said in the statement that Valcambi would look to use Rajesh's technical expertise to produce innovative gold products in the European markets.

REUTERS