Gem Diamonds Di Regulatory News (GEMD)

10 Sep 2007 07:02

Gem Diamonds Limited10 September 2007 10 September, 2007 GEM DIAMONDS LIMITED ("Gem Diamonds" or the "Company") SALE OF WOODLARK GOLD PROJECT Gem Diamonds Limited (LSE: GEMD) ("Gem Diamonds") is pleased to announce it hassold the Woodlark Gold Project for US$26.5 million to a company jointly owned byprivate equity fund Pacific Road Resources and resources financing andinvestment business RMB Resources Limited, a subsidiary of Rand Merchant Bank. The purchase price will be settled in cash and the effective date is 1 July2007. The Woodlark Gold Project formed part of BDI Mining, which was acquired by GemDiamonds in June 2007 for US$80.1 million. The divestment of the gold assetreduces the effective price of the remaining asset, the Cempaka alluvial diamondmine in Indonesia, to US$53.6 million. Work at Cempaka is ongoing where the decision has been taken to invest US$16million to improve mining efficiencies, infrastructure and plant and allow foran increased level of production to 80,000 bcm per month. Gem Diamonds CEO Clifford Elphick commented: "The sale of Woodlark was anticipated at the time of the acquisition of BDIMining and the price achieved is pleasing. This disposal allows the newmanagement of BDI Mining to focus exclusively on diamond production at Cempaka,in line with Gem Diamonds' strategy of becoming one of the world's leadingdiamond companies". For further information: Gem Diamond Technical ServicesClifford ElphickAngela ParrTel: +27 83 578 3885 Pelham PRCandice SgroiTel: +44 207 743 6376 About Gem Diamonds Gem Diamonds is a diamond mining company with a balanced portfolio of aproducing kimberlite mine, two producing alluvial mines, development projectsand long-term prospects. Established in July 2005, Gem Diamonds is pursuing anaccelerated growth strategy and aims to become one of the world's leadingdiamond companies. Gem Diamonds currently has one producing kimberlite mine, Letseng, in Lesotho, two producing alluvial mines - Cempaka in Indonesia andMbelenge in the Democratic Republic of Congo (DRC), a kimberlite developmentproject in Botswana, three development projects in the DRC, one in the CentralAfrican Republic and an option to develop the Chiri kimberlite concession inAngola. The Company recently made an offer to Kimberley Diamond Company's shareholdersto acquire their shares in this company, which owns the Ellendale Mine in northwestern Australia. Gem Diamonds has a specific focus towards higher value diamonds, a segment ofthe market that its management believes will deliver superior long term returns. In February 2007, Gem Diamonds listed on the London Stock Exchange and raisedUS$600 million (net of expenses) to fund development of its existing assets aswell as to pursue acquisitive growth opportunities. Gem Diamonds trades underthe code GEMD. At the time of this announcement the market capitalisation of thecompany is approximately US$1,2 billion. For further information about Gem Diamonds visit www.gemdiamonds.com. This information is provided by RNS The company news service from the London Stock Exchange