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Description:  Harry Winston Diamond Corp. (HW)’s $1 billion sale of a luxury unit to Swatch Group AG (UHR) provides the cash to invest more in diamond mining, a business that last year was more than twice as profitable as jewelry.

Source:  Bloomberg.com

Date: Jan 15, 2013

Link: http://www.bloomberg.com/news/2013-01-15/harry-winston-to-use-swatch-cash-for-diamonds-purchases.html

Questions for Discussions:

  • Explain the logic of selling the retail division to Swatch in order to finance the development of more mining.
  • How else could the firm have financed more mining?
  • Do you think the decision was a good one?
  • Would you be an investor in either firm today?

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