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June 30, 2016
The highly touted Lesedi La Rona — the tennis ball-sized rough diamond weighing 1,109 carats — was expected to smash the world record for any gemstone sold at auction. Instead, it went unsold at Sotheby's London yesterday when the bidding stalled at $61 million, short of the undisclosed reserve price.
Experts had conservatively pegged the value of the gem-quality, Type IIa diamond at $70 million or more. Once cut, the rough was expected to yield a 400-carat flawless diamond.
It was an extraordinarily rare occurrence to see a rough diamond offered at a public auction. Typically, these stones are traded among a handful of sophisticated dealers within the diamond industry.
But, Lesedi La Rona was no ordinary rough diamond. It was the largest gem-quality rough diamond discovered in more than 100 years. Because of its "rock star" status, mining company Lucara decided to break with tradition and roll the dice at Sotheby's with a special auction dedicated to one diamond.
Lucara was betting that wealthy individuals outside the diamond industry would want to get in on the excitement. The New York Times reported that Lucara chief executive William Lamb had been working with Sotheby’s and Julius Baer, a Swiss bank, to attract private clients from around the world.
The Sotheby's gallery was nearly filled to capacity when auctioneer David Bennett asked for the starting bid of $50 million. Viewers around the world watched online in real-time via streaming video.
The offers for Lesedi La Rona notched up slowly in increments of $500,000. But only a few minutes later, the bidding ground to a halt at $61 million. Bennett gave fair warning and then hit the gavel.
Soon the audience learned the gem had not reached the auction house's pre-established minimum price. Bennett announced the gem would not be sold and walked away from the podium.
The last time Sotheby’s put a rough stone up for sale was in 2000. In similar fashion, the purple-pink 12.49-carat diamond failed to sell, the Times reported.
Interestingly, Lesedi La Rona's stablemate at Lucara, the 813-carat diamond called The Constellation, was sold privately to Dubai-based Nemesis International for a record $63.1 million back in May. It was the highest price ever paid for a gemstone, rough or polished.
If Lesedi la Rona had earned the same $77,649 per-carat achieved by The Constellation, it would have fetched upwards of $86 million.
For now, the 14.62-carat Oppenheimer Blue, which sold for a record $57.5 million at Christie's Geneva in May, will hold onto its record for the highest priced jewel ever sold at auction.
Had the Lesedi La Rona sold at auction, the buyer would have paid a 12% buyer's premium on the amount over $3 million and a 20% fee on the first $3 million. The reserve price was not made public.
Credits: Images courtesy of Sotheby's. Screen captures via Sothebys.com.