Rockwell Diamonds has agreed to buy Bondeo 140 CC’s alluvial diamond properties and associated plant and equipment in the Middle Orange River region of South Africa for C$28.5m ($24m).

The transaction comprises $12m for the mineral rights and three fit-for-purpose processing plants and $16.5m allocated to earthmoving fleet and other associated equipment.

The company will pay $16.5m over a period of ten months in equal instalments and plans to refinance the balance associated with equipment leases as well as hire purchases on similar terms with South African financial institutions or existing mobile fleet and equipment supply partners.

Rockwell Diamonds CEO and president James Campbell said: "Our executive and operational management have demonstrated their alluvial diamond production expertise during Rockwell’s corporate turnaround and have the capacity to take on these additional assets.

"We know the geology of the area. So these new assets offer economies of scale, with the potential to reduce the volatility of our quarterly production results and take us above our target of processing 500,000m3 per month."

Subject to closing conditions including regulatory approvals, the deal will be concluded in the second quarter of 2015.

Dundee Capital Markets will provide financial assistance to Rockwell on the transaction.