from stockwatch by will Purcell
Dermot Desmond and Jonathan Comerford's Mountain Province Diamonds Inc. (MPVD), which gained one cent to $3.48 on 273,000 shares, has picked Stuart Brown to be its new president and chief executive officer. He replaces Patrick Evans, who left the company a year ago by "mutual decision" -- a tactful way to describe the "you're fired; no, I quit" departure dance. While Mountain Province hunted for a replacement, David Whittle, an independent director, had been doing the job on an interim basis. He now returns to his previous role, which he has held since 1997. (Only Carl Verley, a director who predates the company's 24-year diamond focus, has been with Mountain Province longer. He arrived in 1986.)
Mr. Brown will not take up his new job until the start of July, presumably because he will not be leaving his current position as CEO of Firestone Diamonds PLC until the end of June. He has been with Firestone for the past five years. Mr. Comerford, Mountain Province's chairman, touts Mr. Brown as being responsible for "securing the financing and building the team that delivered the successful construction and transition to production" at Firestone's Liqhobong mine in Lesotho. (Firestone's new CEO, Paul Bosma, apparently was that team: He was Firestone's general manager at Liqhobong.) Mr. Brown had previously spent well over 20 years with De Beers Group, becoming its chief financial officer in 2006 and joint acting CEO in 2010.
Mr. Comerford cranked opened the taps on his gusher of praise for Mr. Brown, saying that he was a "stand-out candidate" through the company's "exhaustive search" for its new head. Mr. Comerford said that his new man "has incredible experience in the space" -- using the new-age buzz-word for sector, not lauding Mr. Brown as a veteran astronaut. While Mr. Brown may not have walked and talked on the moon, one might be excused for thinking he can walk on water, as Mr. Comerford says that he is confident that Mr. Brown's experience and standing in the diamond industry -- an old-fashioned term for "space" -- will add substantial value to the company. (He was right, initially: Mountain Province's stock jumped 29 cents to an intraday high of $3.60 Tuesday, temporarily adding $60-million to the company's market value.)
Among Mr. Brown's first important acts will be setting Mountain Province's first dividend, which the company says will come on the heels of its second quarter results. As well, he will have to deal with his former employers, as Mountain Province needs to roll the Kelvin and Faraday kimberlites, which it recently acquired through its recent reacquisition of Kennady Diamonds Inc., into the joint venture agreement with De Beers covering the Gahcho Kue mine. For that to happen, De Beers will have to acquire the same 51-per-cent interest that it holds in Gahcho Kue. Mountain Province paid $176-million in stock to acquire Kennady; convincing De Beers to pay $90-million for 51 per cent of Kennady could be a tough sell, even for the incredibly experienced Mr. Brown.