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Japanese Collector Snaps Up "Bargain" US$15.7m Diamond

He purchased the record-breaking stone for his younger daughter, renaming it the 'Maiko Star', after her. 

The 102.3 carat 'Maiko Star' (c) Sotheby's

A 102.39-carat D Colour Flawless Oval Diamond has sold for US$15.7 million in an unprecedented single-lot live auction at Sotheby's Hong Kong, offered without reserve – a first at auction for a lot of this value, a move considered to have back-fired by some. 

According to Sotheby's, the bidding quickly escalated from HK$1(US$.12) to well over US$10m. Some of those bids were also placed online, the highest of which was US$10.97m - breaking records for the highest value bid ever placed on a jewel online. Before, the highest price paid for a jewel in an online auction was US$2.1 million at Christie's in July for a 28.86 carat diamond. 

The winning bid, though, came over the phone from a private collector in Japan, who, shortly after the sale, renamed the diamond the ‘Maiko Star’, after his second daughter. This now establishes a family tradition: last year, the same collector purchased another important diamond from Sotheby’s, naming it the ‘Manami Star’, after his eldest daughter.

Perfect according to every critical criterion, this gem has achieved the highest rankings under each of the standards by which the quality of a diamond is judged (‘the four Cs’). The diamond is D colour (the highest grade for a white diamond); of exceptional clarity (it is completely flawless, both internally and externally), and has excellent polish and symmetry, the most sought-after grading for the oval shape category. This gem belongs to the rare subgroup comprising less than 2% of all gem diamonds, known as Type IIa. Diamonds in this group are the most chemically pure type of diamond and often have exceptional optical transparency. 

The diamond in the rough (c) Sothebys

The 102.39 diamond was cut from a 271-carat rough discovered in the Victor Mine, Ontario, Canada in 2018.  Following its discovery, the rough was cut and polished over a year by Diacore, a specialist in sourcing, cutting and polishing extraordinary diamonds, to bring out its best brilliance, fire and scintillation. Only eight D colour Internally Flawless or Flawless white diamonds over 100 carats ever sold at auction.

Patti Wong, chairman of Sotheby’s Asia, commented: “This extraordinary gem needed no help from a pre-sale estimate or reserve to reach its rightful price – just the instinctive desire of collectors to own one of the earth’s greatest treasures."

However Tobias Kormind, managing director of 77 Diamonds, Europe's largest online diamond jewelery retailer, believes the price could have been higher. He had thought the diamond would surpass US$33.7m, the highest overall price paid at auction for a white diamond, at Christie's Geneva in 2017. 

"The buyer of this diamond has bagged a bargain! During this time of global economic uncertainty, unseen for a century, US$15.7 m is a steal for this diamond. Savvy investors are currently falling over themselves to acquire alternative safe haven assets like diamonds, property and gold. With valuations of some stocks and shares overheated, others showing signals of distress, income-generating assets providing low to negative yields and high unemployment very much on the cards, demand for alternative assets remains buoyant and resilient."  

He adds: "In an unprecedented move for this calibre of stone, the seller was prepared to part with this stone without putting a reserve on it, a brave decision that has come back to bite them, achieving a less than optimum price."

During the pandemic, the average price of online purchases has soared. In April, Sotheby's sold a Cartier Tutti Frutti bracelet for more than £1.3 million, online followed by the record-breaking Christie's sale in July.

"The success of the online format asserts the advent of a new luxury normal, where the rarest items in the world will increasingly be offered up for online bidding, without buyers having first seen and touched them in the flesh," adds Kormind.