On August 13, 1928, along the shores of the San Antonio River in Brazil, two garimpeiros (gold diggers) noticed a large rock embedded in the gravel of the River. The rock was the Vargas Diamond weighing in at 726.6 carats. Wanting a fast fortune, the two prospectors sold the diamond to a broker for $56,000 who then immediately sold it for $235,000. The broker in turn sold the gem to a Dutch syndicate represented by the Dutch Union Bank of Amsterdam. Now named "President Vargas" in honor of Getulio Dornelles Vargas, President of Brazil (1930-45 and 1951-54), the stone went up for bid.
Harry Winston in his office high above fifth avenue learned of the diamond's existence and immediately arranged travel, stopping off in London and then on to Amsterdam. The desire for this incredible find was not his alone, and he bid against diamond merchants from Antwerp, Amsterdam, London and New York. Harry Winston won the bid, purchasing the diamond for some $700,000. The diamond was then shipped by ordinary registered mail, (like the Hope Diamond) to his office in New York. The diamond was insured by Lloyds for $750,000 should anything occur. Nothing did and the diamond arrived safely at Harry Winston's office, five floors above the hustle and bustle of Fifth Avenue.
Harry Winston had certain plans for the diamond, plans which were a tad risky and could turn this formidable diamond into dust. Harry Winston wanted to cut the diamond into 23 smaller diamonds which would accrue $2,000,000 when sold.
Harry Winston called for the best diamond cutter in the business, Adrian Grassley. Adrian Grassley had been cutting diamonds for over 40 years, but he had never done anything like this. Just the thought of striking a diamond of this size made him weak to his knees. Before the final strike, the diamond was studied. More than 100 plaster and glass models were made and after a year of intensive scrutinizing, the final decision as to its division was made. A diamond expert marked the gem taking careful account of the direction of the grain. One incorrect cut could shatter the diamond rendering it utterly worthless.
Tuesday, July 29th, 1941, Grassley entered the small fortified room which held the diamond. He had tossed and turned the night before unable to sleep, unnerved by the task ahead. He spent the morning carefully grooving a V shaped notch at the precise spot of cleavage. Finally it was time. At 2pm, the traffic of 5th avenue a drone in the distance, Adrian Grassley, Harry Winston and his diamond polisher were the only people in the room. Grassley placed a dull edge steel blade in the V shaped notch and tapped lightly. Nothing happened. Grassley was unconsciously holding back for fear of failure.
Suddenly Harry Winston reached for the stone. Was there a cross grain no one had noticed? Could it be possible a year of calculations a miss? As he peered into the diamond's flawless depth he noticed a tiny four millimeter fracture - perfectly straight and true.
"Strike it harder," Winston urged Grassley knowing that this final blow could cost him millions. Grassley did but still the Vargas did not break. Grassley reached for a slightly heavier rod, and this time the diamond split into two. Perfectly.
Tears of relief coursed down Grasley's cheeks, "Never again," he says, "Never again."
This split created a 550 carat diamond and a 150 carat diamond which were later cut into 29 diamonds, 6 more than originally intended. Of the larger diamonds, 16 were emerald cut, 1 pear shape, one marquise and smaller triangle cuts and a baguette, a total of 411.06 carats.