Graff pays $4 million for white diamond...by Graff

London-based jeweler Laurence Graff paid nearly $4 million to buy back a white diamond ring of his own creation at a sale where wealthy investors seeking alternative assets snapped up top-quality gems, Christie's said on Thursday. Graff, whom close associates said was in China this week, made the winning bid by telephone to the semi-annual jewelry sales in Geneva on Wednesday night, the auction house said.

"He bought it back and he will sell it a second time," Jean-Marc Lunel, head of Christie's jewelry department in Geneva who conducted the sale, told Reuters.

"He is the King of Diamonds and recognizes his babies. The stone is fabulous and in great shape in terms of cut, color and clarity," he added.

The oval-shaped diamond, weighing 24.30 carats, is graded 'D' color and potentially internally flawless if repolished slightly on the surface, according to Lunel.

It was put on the block by an unidentified woman and had a pre-sale estimate of $2.9 million-$3.5 million, according to the catalog.

Christie's, owned by French billionaire Francois Pinault, netted 56.26 million Swiss francs ($61.37 million) from the event, with 77 percent of the 361 lots on offer sold, it said in a statement.

A gray diamond weighing 10.67 carats, which had been estimated at $120,000-200,000, soared to $1.19 million, a world record price for a gray diamond, according to Lunel. Earrings made of pear-shaped Colombian emeralds and diamonds fetched $3.078 million, also a record price at auction, he said.

"What is in the mid-range or not so attractive doesn't sell well. But what is exceptional sells at astronomical prices -- colorless diamonds, colored diamonds and colored gems including rubies from Burma (Myanmar)," Lunel said.

"There are more and more private collectors, clients looking for new investments. They are looking for top, top quality gem stones, to put their money into something that will not melt," he said.

Graff, who often attends auctions, is a self-made diamond merchant who became one of Britain's richest men with an estimated worth of around 2 billion pounds ($3.2 billion).

Graff Diamonds plans to raise about $1 billion in a Hong Kong listing next year, a move to fund further expansion in Asia and capitalize on booming demand for high-end gems in China and India.

"I think it is a clever move because he is number one today. He still has room to expand everywhere," Eric Valdieu, a jewelry expert formerly with Christie's who has launched an investment fund "Divine Jewels", told Reuters.

"It is a very expensive business. Therefore, if he wants to go faster he needs large financial support," he said.

Graff's glittering stores sit on the world's most exclusive shopping streets, including the posh rue du Rhone in Geneva.

"When I see his inventory, the quality of his merchandise, the beauty of his shops, how cleverly everything is run, I can only suggest to people to go for it -- if people want to invest with a retailer," Valdieu said.

"They are investing with someone who knows what he's doing," the Frenchman added.

Rival Sotheby's sold the "Sun-Drop Diamond", a huge yellow diamond weighing 110.03 carats for $12.36 million, a world record for a yellow diamond, in Geneva on Tuesday night.

-Reuters