Paragon Diamonds has announced that the company has received an amount of £500 000 as an unsecured debt from an investment company. The funds may be used to initiate a share buyback, senior officials of the company were reported to have said, and also for short-term working capital requirements that may arise from the acquisition of the Mothae diamond project in Lesotho.

The acquisition of the Mothae project, which was announced by the company last month, is expected to receive final government approval soon. Paragon chairperson Philip Falzon Sant Manduca is scheduled to meet the Lesotho Mines Minister Lebohang Thotanyana on June 22, and request immediate approval.

Media reports quote Paragon officials as stating that the loan matures end-September, and carries a fixed monthly interest rate of 1.25%. It also carries a 3% arrangement fee and 3.57 million detachable call warrants with an issue price of 7 pence.

Paragon Diamonds is already operating the Lemphane kimberlite project in Lesotho.