(Rapaport…June 5, 2000) The London Stock Exchange (LSE) expressed concern about the IPO of Oryx, a Cayman Island-registered diamond company that has links to the Zimbabwean army and the Congolese government.
The LSE’s concerns are based on Oryx’s ownership of a mining concession in war-torn Congo. The prospectus values the concession at close to $1 billion dollars. One of the issues is whether Oryx-mined diamonds could be used to fund the Congolese governments defense against Rwandan-backed rebels. This comes at a time when the British government is stepping up efforts to end the trade of conflict diamonds in war zones.
The Alternative Investment Market, (AIM) London’s least regulated market, is supposed to float Oryx through a reverse takeover of Petra Diamonds, a mining group. Under AIM rules, the LSE can only put pressure on advisors to delay or postpone the float.
Oryx and Petra have denied that the concession, near the diamond town of Mbuji Mayi in southern Congo, is in a war zone. Last week the company said: “It’s not a war zone and they are not blood diamonds. There is conflict in the country, but not in the concession area.”
The UN presence in Congo said fighting between the Congolese government and its Zimbabwean allies against rebel forces had taken place in areas surrounding the concession.
Pete Riley, the UN mission’s military spokesman said that before the cease-fire agreement was reached on April 14, “the focus of much of the fighting had been in Kasai, the region where Mbuji Mayi is. He added, “It was apparent that [the rebels] were attempting to cut the supply lines to Mbuji Mayi.”