Petra dives as big investor dumps stake

London - Petra Diamonds said its second-largest shareholder sold more than two-thirds of its stake in the diamond miner through a placement at a discount of 12% to the stock's Monday close.

The stock was down 11% at 193.25 pence at 12:42 on the London Stock Exchange. The stock had fallen 12% earlier on Tuesday on rumours of the placement.

Awal Bank placed 43 million shares with UK and international institutions at 190 pence per share or about $139m.

A further 13.2 million shares held by Awal Bank - owned by Maan al-Sanea, the Saudi billionaire head of the Saad Group - are subject to a 90 day lock-up, Petra said in a statement.

Petra's website shows that Awal Bank held 60.8 million shares or 11.9% in Petra through Saad Investments.

The miner said it was unaware if the remaining 4.6 million shares held by Awal Bank were to be sold at this time.

Petra, which has five producing mines in South Africa and one in Tanzania, reported a 17% jump in full-year production on Monday.