March 19 (Bloomberg) -- Kinross Gold Corp., Canada’s third- largest gold producer, will spend $150 million for a 19.9 percent stake in Harry Winston Diamond Corp. and an interest in a diamond mine the jeweler owns with Rio Tinto Group.

Kinross will buy 15.2 million treasury shares to be issued by Harry Winston for $3 each and will pay $104.4 million for 22.5 percent of the jewelry retailer’s interest in the Diavik mine in Canada’s Northwest Territories, Toronto-based Kinross said today in a statement. Rio operates and owns 60 percent of the mine, and Toronto-based Harry Winston owns the remainder.

Harry Winston on Dec. 10 said sales and earnings before taxes and financing costs fell because of lower-grade ore at Diavik and an increased loss in its retail business.

Kinross said it will have a seat on Harry Winston’s board. Harry Winston said separately that it will suspend dividend payments “because of the current challenging global economic conditions.”

Kinross rose C$1.22, or 5.6 percent, to C$23.10 at 4:46 p.m. in Toronto Stock Exchange trading. The shares have gained 2.7 percent this year. Harry Winston fell 12 cents, or 5 percent, to C$2.28.

To contact the reporter on this story: Rob Delaney in Toronto at robdelaney@bloomberg.net.

Last Updated: March 19, 2009 17:35 EDT