Babylon
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- Feb 5, 2009
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Tanzanian ruby valued at £11m sells for just £8,000 after being proved to be a lump of rock
Last updated at 5:16 PM on 17th February 2010
A giant ruby once valued at £11million has sold for just a fraction of the price after documents proved it was a forgery, it emerged today.
The 10,700 carat Gem of Tanzania, once believed to be the largest ruby in the world, was sold for just £8,010 by administrators Ernst & Young.
The rock once underpinned the balance sheet of Shropshire firm Wrekin Construction and was listed as an £11million asset by the company's owner David Unwin.
But after the company collapsed last spring the estimated value of the 4.4lb purple rock dropped to as little as £100.
Some value could be recouped if the gem is broken up to release smaller rubies inside, but in its current form it is simply a lump of anyolite, a practically worthless grade of ruby.
The gem was sold off by administrators last week in an attempt to recoup some of Wrekin's £40million debts to their 1,000 creditors.
It was bought by Network Group Holdings whose Network Construction Services in Telford are owed several hundred thousand pounds by Wrekin.
Wrekin Construction was 'saved' by the stone in 2007 after Derbyshire entrepreneur David Unwin offered the gem in return for preference shares.
He produced a certificate of valuation assumed to be genuine and the gem was listed as an asset - transforming the fortunes of the company.
Mr Unwin purchased the coconut-sized stone for £300,000 and it was supposedly valued at £11million by the Instituti Gemmologico Italiano, Italy, in 2007.
But last year an investigation revealed the ruby, which is believed to be cursed, was practically worthless and its valuation was forged.
The stone was previously owned by Trevor Michael Hart Jones, a South African businessman convicted of illegal diamond trading.
In 2004 a documentary exposed Hart Jones' attempt to peddle a £100million scheme to cure AIDS using a type of goat serum.
The notoriety of the stone attracted 60 closed bids before the 16 December deadline and the sale was confirmed last week.
New owners Network Group Holdings believe the Gem of Tanzania was a bargain and may still fetch up to £2million when broken into smaller gems by a skilled jeweller.
Tim Watts, owner of Pertemps, which controls Network Group Holdings, views the stone as a sound investment.
He said: 'We expect to sell it at a very substantial profit - there are at least 20 significant smaller rubies on its surface.'
Jon Smith, group operations director for Network Group Holdings, remains optimistic about the stone's future.
He said: 'It quickly became apparent to us following Wrekin's collapse that we would be unlikely to recover what was owed to us through normal channels.
'We have therefore opted to make this strategic investment and the ruby has been placed in the Birmingham Deposit Centre for safekeeping where we hope it will continue to rise in value.'
The gem's true value will remain a mystery until it is carved into a collection of smaller stones and officially valued
Last updated at 5:16 PM on 17th February 2010
A giant ruby once valued at £11million has sold for just a fraction of the price after documents proved it was a forgery, it emerged today.
The 10,700 carat Gem of Tanzania, once believed to be the largest ruby in the world, was sold for just £8,010 by administrators Ernst & Young.
The rock once underpinned the balance sheet of Shropshire firm Wrekin Construction and was listed as an £11million asset by the company's owner David Unwin.
New owner of the ruby Tim Watts views the stone as a sound investment
But after the company collapsed last spring the estimated value of the 4.4lb purple rock dropped to as little as £100.
Some value could be recouped if the gem is broken up to release smaller rubies inside, but in its current form it is simply a lump of anyolite, a practically worthless grade of ruby.
The gem was sold off by administrators last week in an attempt to recoup some of Wrekin's £40million debts to their 1,000 creditors.
It was bought by Network Group Holdings whose Network Construction Services in Telford are owed several hundred thousand pounds by Wrekin.
Wrekin Construction was 'saved' by the stone in 2007 after Derbyshire entrepreneur David Unwin offered the gem in return for preference shares.
He produced a certificate of valuation assumed to be genuine and the gem was listed as an asset - transforming the fortunes of the company.
The Gem of Tanzania was once valued at £11million, but was sold for just £8,010 by administrators Ernst & Young
Mr Unwin purchased the coconut-sized stone for £300,000 and it was supposedly valued at £11million by the Instituti Gemmologico Italiano, Italy, in 2007.
But last year an investigation revealed the ruby, which is believed to be cursed, was practically worthless and its valuation was forged.
The stone was previously owned by Trevor Michael Hart Jones, a South African businessman convicted of illegal diamond trading.
In 2004 a documentary exposed Hart Jones' attempt to peddle a £100million scheme to cure AIDS using a type of goat serum.
The notoriety of the stone attracted 60 closed bids before the 16 December deadline and the sale was confirmed last week.
New owners Network Group Holdings believe the Gem of Tanzania was a bargain and may still fetch up to £2million when broken into smaller gems by a skilled jeweller.
Tim Watts, owner of Pertemps, which controls Network Group Holdings, views the stone as a sound investment.
He said: 'We expect to sell it at a very substantial profit - there are at least 20 significant smaller rubies on its surface.'
Jon Smith, group operations director for Network Group Holdings, remains optimistic about the stone's future.
He said: 'It quickly became apparent to us following Wrekin's collapse that we would be unlikely to recover what was owed to us through normal channels.
'We have therefore opted to make this strategic investment and the ruby has been placed in the Birmingham Deposit Centre for safekeeping where we hope it will continue to rise in value.'
The gem's true value will remain a mystery until it is carved into a collection of smaller stones and officially valued
