Petra Diamonds (LSE:PDL) plans to launch a strategic review that could lead to a sale of the company as the current market downturn continues to put pressure on its business.
The review will explore all potential paths to addressing the liquidity needs of the business, the UK-listed diamond miner says in a statement.
As part of the changes, José Manuel Vargas has stepped down as chair and will be replaced on an interim basis by current board member Lerato Molebatsi.
Vargas previously oversaw Petra through its refinancing in 2025.
Diamond market pressures mount
The strategic review comes just months after Petra placed its Finsch mine in South Africa into business rescue ahead of a potential permanent closure.
The mine, acquired from De Beers in 2011, has historically been one of the world’s major diamond operations and one of South Africa’s largest by production.
The decision to place Finsch into business rescue came amid deteriorating conditions across the natural diamond market in recent years.
Petra, alongside its peers, has been hard hit by falling diamond prices and growing competition from lab-grown diamonds. De Beers last year recorded a US$511 million ($737.2 million) underlying loss while parent company Anglo American (LSE:AAL) continued to pursue a sale of its diamond unit.
Geopolitical tensions in the Middle East and US import tariffs have added further pressure, worsening an already challenging environment for diamond producers.
“We are faced with an unprecedentedly weak diamond market, due to global macro factors as well as the recent Middle East tensions,” Petra CEO Vivek Gadodia said earlier this year.
The prolonged downturn has increased liquidity pressure across Petra’s operations, prompting the company to consider a broader range of options for its future.
Shares of Petra plunged 21% by the close of trading in London following the announcement, extending its year-to-date decline to around 70%.
Write to Jackson Chen at Mining.com.au
Main Image: Petra Diamonds
