Petra Diamonds drops as new issue floods the market

Independent diamond miner Petra Diamonds (LON:PDL) saw its shares drop by 23.58% to 56.55p at 1250 BST after the company issued 332 million new shares this morning.

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Shareholders overwhelming approved a new issue in order to reduce debt at a general meeting yesterday, but analysts have said that it is a short term patch for a more serious issue. Production at the company’s Tanzanian facilities remained low, with the ongoing impact of strike action casting a pall over the firm. However, the fresh injection of capital may give Petra the time required to stabilise and return to growth.