20 May 2009 07:00
NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN
20 May 2009
TanzaniteOne Limited
£3.49 MILLION PRIVATE Placing
The Board of TanzaniteOne ("TanzaniteOne" or "the Company") (LSE AIM: TNZ.L) todayannounces that it has raised approximately £3.49 million (approximately US$5.3 million) gross of expenses through a private placing of 23,270,469 common shares of US$ 0.0003 each ("Placing Shares") at 15p per Placing Share (the "Placing"). The net proceeds of the Placing will be used to provide funds for the acquisition of gem quality tanzanite in the local market, fund the bulk sampling of the Company's tsavorite assets, fund further development work on the Company's tanzanite assets and provide general working capital for the group.
Use of Funds
Tanzanite trading
In order to generate a stable tanzanite market and to secure a reliable supply of gem quality tanzanite for its customers, Tanzanite One operates a trading operation from it offices in Arusha. This trading operation focuses on acquiring gem quality stones of at least 1 carat in the local market.
In order to facilitate further purchases of gem quality tanzanite during this period of depressed prices, the Company intends to use up to $2 million of the placing proceeds to fund further purchases.
Tsavorite
The Company intends to utilise US$1 million of the placing proceeds to develop its tsavorite projects as part of its diversification strategy. The funds will be used to continue the bulk sampling and scoping study of the 20Mt alluvial deposit located approximate 20km - 40km from the existing Tanzanite operation.
General working capital
The balance of the placing proceeds will be used to fund the general working capital requirements of the business going forward. This included ongoing mine development costs, tanzanite and tsavorite marketing as well as the development of new sales and markets.
Directors' Participation
The following Directors have subscribed for Placing Shares at the Placing Price. Immediately after Admission, it is expected that these Directors will have the following beneficial shareholdings:
| Director | No. of Placing Shares subscribed for | Total number of common shares held following the Placing | Percentage of the enlarged issued share capital immediately following Admission |
| Edward Nealon | 1,333,333 | 2,779,855 | 2.63% |
| Bernard Olivier | 88,067 | 301,087 | 0.29% |
| Nicholas Sibley | 1,333,333 | 4,402,243 | 4.22% |
| Zane Swanepoel | 66,050 | 66,050 | 0.06% |
Settlement
The Placing Shares will rank pari passu in all respects with the Common Shares and will represent 22.31% of the Company's enlarged issued share capital. Application has been made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM and it is expected that admission will occur on 26 June 2009 ("Admission").
Following Admission the Company will have 105,197,160 Common Shares in issue.
Bernard Olivier, Head of Development commented today: "I am extremely pleased that TanzaniteOne has been able to raise this additional capital at a time of such turbulence in world markets. This placing will enable us to follow our strategy; to concentrate on supporting the tanzanite prices by purchasing gem quality tanzanite via our trading operation in Arusha and fund further development work on our tanzanite assets as well as developing our tsavorite projects. We are encouraged by the recent signs of improvement in the tanzanite market particularly the sales and demand increases which was evident in our recent upturn in total sales; US$ 4.64 million tanzanite sales in the four months up to until 30 April 2009."
For more information please visit www.tanzaniteone.com or contact:
| Willi Boehm, Company Secretary | Bernard Olivier |
| +61 (0)8 9367 5211 | +614 (0)894 8182 |
| Nick Bias, Investor Relations | Laurence Read, Public Relations |
| +41 (0)79 888 1642 | +44 (0)7979 955 923 |
| Nominated Advisor and Joint Broker: Evolution Securities | Joint Broker: Ambrian Partners |
| Simon Edwards or Neil Elliot | Richard Chase |
| +44 (0)20 7071 4300 | +44 (0)20 7634 4700 |
This announcement has been issued by, and is the sole responsibility of, Tanzanite One Limited.
These written materials are not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration under the US Securities Act of 1933 (the "US Securities Act") or an exemption therefrom. Tanzanite One Limited has not registered and does not intend to register any of the Placing Shares under the US Securities Act. The Placing Shares will not be offered or sold to the public in the United States.
Evolution Securities Limited is acting exclusively for Tanzanite One and for no one else in connection with the Placing and will not be responsible to anyone other than Tanzanite One for providing the protections afforded to the customers of Evolution Securities Limited or for providing advice in relation to the Placing or any transaction or arrangement referred to herein.
The release, publication or distribution of this announcement into certain jurisdictions other than the UK may be restricted by law and therefore persons in such jurisdictions into which this announcement is released, published or distributed should inform themselves about and observe any such restrictions. Any failure to comply with any such restrictions may constitute a violation of the securities laws or regulation of such jurisdictions.
This announcement is not for release, publication, or distribution, directly or indirectly, in whole or in part, in or into Australia, Canada, Japan, or the United States and does not constitute, or form part of, an offer or the solicitation of an offer, or inducement, or invitation to subscribe for, buy, underwrite or otherwise acquire, any rights, shares, or other securities, nor the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, issue or transfer of shares in the Company in any jurisdiction in contravention of applicable law.
Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser. No statement in this announcement is intended to be a profit forecast or to imply that the earnings of the Company for the current year or future years will necessarily match or exceed the historical or published earnings of the Company.