'Pink Star' diamond fetches record $71.2m

Ten minutes of intense telephone bidding on Tuesday culminated in a record-setting price for any diamond or jewel.

The Hong Kong Chow Tai Fook jewelry paid a hammer price of $63 million (59 million euros) and beat out two other bidders in what Sotheby's chairman for international jewelry David Bennett called the "historic sale" of the oval-shaped "Pink Star" diamond.

The crowd packed into the Hong Kong auction room erupted with applause when it was finally sold. Sotheby's kept an $8.2 million buyer's premium, which the buyer pay on top of the hammer price.

"We're very happy," Sotheby's Asia chairwoman Patti Wong said. "I know there was a lot of talk about the economy in China not being as positive as it was a few years ago," but the results from Tuesday's jewelry auction, which included nearly 200 other lots, were very strong, she said.

The Chow Tai Fook jewelry group is chaired Henry Cheng, whose family was ranked third on Forbes' Hong Kong rich list with an estimated wealth of $17.9 billion. The group boasts a major network of stores in China, with outlets in Hong Kong, Macau, Malaysia, Singapore and Taiwan. However, it remains relatively unknown in the West.

The sparkling "Pink Star" measures 2.69 by 2.06 centimeters (1.06 by 0.81 inches) and weighs 11.92 grams (0.026 pounds). It was reportedly 132.5 carats when it mined in its raw form by De Beers in South Africa in 1999. It was then cut and polished over a period of two years.

Prior to Tuesday's sale, the most expensive diamond ever sold at auction was the "Oppenheimer Blue," which fetched 56.8 million Swiss francs (then $57.6 million) last May.

Second time lucky

The "Pink Star" diamond was sold three years earlier for an even higher price at another Sotheby's auction in Geneva.

A New York-based diamond cutter bought the gem for $83 million. However, the deal fell apart after the buyer defaulted and Sotheby's was forced to buy back the diamond.

Wong said she was not worried at all about the same thing happening again, as the auction house had vetted all prospective bidders ahead of the sale.

"All three bidders...have a long-standing relationship with the company and we were very, very confident that all three bidders had the financial capability and of course the buyer definitely had the financial capability," she said.

Sotheby's decided that this year was the right moment to put the "Pink Star" back on the market, amid rising demand from wealthy Asian buyers. "The Asian element in the jewelry market is extremely important and from what I've been hearing from members of the trade I've been talking to, in the last six months they have become more and more important," Sotheby's jewelry expert David Bennett said.

dm/sms (AFP, AP)