SOMBA K'E/YELLOWKNIFE - The company with the licence to use the Polar Bear diamond brand has gone into receivership, leaving the brand essentially where it's been for more than a year: in limbo.

Montreal based Polar Ice Diamonds - a subsidiary of privately-owned Basal Diamonds, which in turn owns Arslanian Cutting Works - is seeking protection from creditors as its receiver figures out how to pay US$41.6 million in debts.

Under a contract with the GNWT, Arslanian had the exclusive right to mark its diamonds under the prestigious Polar Bear diamond brand.

But Arslanian Cutting Works began running into trouble in 2009. The plant - which employed around 35 cutters and polishers - closed during the summer of that year, reopened briefly in the fall and closed again in late 2009. It has remained closed throughout 2010.

At its peak, Arslanian polished 4,000 diamonds a month.

Ron Basal, owner of Basal Diamonds, could not be reached for comment.

With Polar Ice's future currently before the courts, the department of Industry, Tourism and Investment is waiting out the proceedings, said Sonya Saunders, director of policy, legislation & communications for the department.

"We're not in a position to be able to speak to those matters right now," she said

Meanwhile, the owner of Yellowknife's sole operating cutting and polishing plant, Crossworks Manufacturing, continues to express interest in the struggling brand.

"It has a great history, and unfortunately it's come under slightly troubled times," said Dylan Dix, spokesperson for HRA Investments, which owns the Crossworks plant in Yellowknife.

"Obviously it's a mark that we've expressed interest in. It's a potentially great brand that can be promoted well.

"If given the right opportunity, we think the Polar Bear (brand) could come back to what it was when it was originally launched with Sirius years ago."

The GNWT is preparing a review of its diamond policy, which it hopes will be ready by the end of the year, said Saunders.

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