Newfield makes takeover proposal

PERTH-based diamond player Newfield Resources has announced a A$40 million raising and possible takeover of AIM-listed Stellar Diamonds.

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Stellar has recently been looking to complete a tribute mining agreement tie-up with privately-owned Octea Mining, which owns the Tonguma diamond asset nearby to Stellar's flagship Tongo project in Sierra Leone.

Newfield has come in with an all-share bid carrying a hefty 452% premium to Stellar's closing share price on January 31.  

Unsurprisingly, Stellar's investors reacted positively to this news, with its shares up 150% overnight. 

Stellar's appeal is the 4.5 million carat resource base at Tongo-Tonguma, which estimates imply could be developed for around US$30 million.

This is strategic to Newfield as it has its own diamond project, Allotropes, just southwest of Tongo-Tonguma. The company also has gold interests in Australia. <...