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Swatch to buy Harry Winston’s jewellery and watch division

$1bn deal.

The Swiss watch manufacturer Swatch Group is planning to acquire the Canada-based Harry Winston Diamond Corporation’s jewellery and watch division for approximately $1bn to expand its presence in the jewellery market.

Swatch Group will pay $750m in cash, apart from assuming up to $250m in debt.

Under the deal, the companies will explore the possibility of setting up a joint venture that will focus on diamond polishing.

Jon Cox, head of Swiss research at Kepler Capital Markets, told the Financial Times: “Swatch has been saying for a while that they want to get into the jewellery business but have never really got off the ground, so from that perspective it makes sense. The joint venture in diamond sourcing is also positive, since Swatch has said in the past that it has had problems getting its hands on diamonds.”

In November 2012, Harry Winston agreed to purchase the Ekati diamond mine in Canada for $500m from BHP Billiton.

Robert Gannicott, chairman and chief executive of Harry Winston, said the sale represented a sound return on the Canadian company’s original investment.

“One of the main reasons that we bought Harry Winston . . . was that we wanted to have the information flow from the polished diamond end of the business to enable us to nimbly price rough diamonds,” Gannicott added.

After the closure of deal, Harry Winston will be renamed as Dominion Diamond Corporation.

Financial advisory group Rothschild advised Harry Winston on the transaction.

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.