Diamond firm's seized assets ordered to be returned by court

By Bloomberg      / July 07, 2017 / www.miningweekly.com / Article Link

LONDON - A Belgian court ordered lender KBC Group to return seized assets from one of the diamond industry's most storied names within 24 hours, a court ruling shows.

Exelco was on track to repay loans to KBC by 2020 as planned, so the lender's early seizure of assets was unnecessary, the Antwerp court ruled on Thursday. A spokesman for KBC declined to comment. Exelco also declined to comment.


KBC is seeking to recover 26-million ($30-million) from Exelco. Bailiffs last month searched the firm's Antwerp offices, as well as offices belonging to De Beers and ABN Amro Group, where Exelco may also hold assets, according to court documents. Exelco also has credit lines with Standard Chartered, Thursday's ruling said.

Companies polishing and trading diamonds are struggling to get credit as major banks seek to reduce exposure to the industry. Standard Chartered, one of the two leading lenders to the industry, said last year it was exiting diamond financing, while KBC's Antwerp Diamond Bank, which made up about a tenth of the financing market at its peak, is being wound down.

Exelco lost its status as one of De Beers's 80 or so handpicked customers, known as sightholders, this year as it had been buying fewer diamonds from the top producer in recent times. It's now an accredited buyer, meaning it's not guaranteed a set supply of rough diamonds and instead buys on a more ad hoc basis, people familiar with the change said. The company is still listed as a sightholder on both its and De Beers's website.

Exelco was founded by Leon and Lior Kunstler and Jean Paul Tolkowsky in 1993. Tolkowsky is a scion of one of the industry's most famous families, who made their name cutting the biggest and most expensive gems. Family members include Marcel Tolkowsky, who is seen as the father of the round brilliant diamond cut, and Gabi Tolkowsky, who was chosen by De Beers to cut the 546 ct Golden Jubilee diamond, the largest faceted stone in the world.