Harry Winston Diamond Corporation to Sell its Luxury Brand Segment to Swatch Group for $750M

Harry Winston Diamond Corporation

(the "Company") announces today that it has entered into an agreement to sell its luxury brand diamond jewelry and timepiece division, Harry Winston Inc., to The Swatch Group Ltd.

for US$750 million plus their assumption of up to US$250 million of pro forma net debt. Chairman and Chief Executive Officer, Robert Gannicott said, "At the time that we purchased the Harry Winston brand, resource investment opportunities for diamonds were rare and expensive following the euphoria of the Canadian diamond discoveries, and the involvement of the large international mining companies. The Harry Winston brand was competitively priced compared with its peers and we could bring diamond expertise and strategic connections to enhance value. Today there is a range of diamond resource opportunities while the value of heritage luxury brands has increased dramatically. This transaction represents a sound return on our original investment. It will leave us well equipped to realize upstream opportunities in an environment where cash has become a strategic resource while preserving and expanding our relationship with the downstream diamond business." The Swatch Group, with its unparalleled combination of expertise in both engineering and brand management, is the perfect