Stellar Diamonds Regulatory News (STEL)

NOT FOR DISTRIBUTION IN THE UNITED STATES OR FOR DISSEMINATION TO US NEWS WIRE SERVICES.

22 January 2015

AIM: STEL

Stellar Diamonds plc

("Stellar" or the "Company")

ISSUE OF EQUITY

Stellar Diamonds plc, the AIM quoted (AIM: STEL) diamond mining and exploration company focused on West Africa, announces that the Company has raised approximately £1 million through the issue of 88,362,066 new ordinary shares of 1p each (the "New Ordinary Shares") at 1.16p per share ("Issue Price") to directors, existing private shareholders and new institutional investors (the "Fundraising"). The Fundraising has been conducted in conjunction with Daniel Stewart & Company plc.

The proceeds of the Fundraising will be used predominantly for the current Trial Mining at the Company's Baoulé kimberlite project in Guinea and for working capital purposes.

Stellar Diamonds Chief Executive Karl Smithson commented:

"With revenues from our first diamond sale of a 5,900 carat parcel expected in the near-term this placement strengthens the Company's balance sheet at a time when capital markets in the junior sector are notoriously weak. It also underscores the support of our existing shareholders, most notably UBS Deutschland, and our directors, many of who are participating. We are also pleased to welcome new shareholders to the Company at this exciting juncture in our growth and development.

"Based on the current processing capacity and grades, we expect to continue to yield approximately 2,000 carats per month with regular diamond exports and sales expected during 2015.

"I look forward to providing further updates on production at Baoulé and our maiden diamond sale."

The Fundraising

The Fundraising has raised a total of £1,025,000 through the issue of 88,362,066 New Ordinary Shares at a price of 1.16 pence per New Ordinary Share. The New Ordinary Shares will be issued credited as fully paid and will rank pari passu in all respects with the existing ordinary shares, including the right to receive all dividends and other distributions declared on or after the date on which they are issued. Application will be made for admission to AIM of the New Ordinary Shares ("Admission"), which is expected to occur, and trading to commence at 8.00a.m. on 5 February 2015.

Total voting rights

Following Admission, the Company's total issued share capital will comprise of 811,929,724 ordinary shares of 1 pence each ("Issued Share Capital"). This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company following Admission.

Substantial Shareholdings

UBS Deutschland ("UBS"), the Company's second largest shareholder, has subscribed for 62,400,000 of the New Ordinary Shares. Following Admission, UBS will hold 126,488,416 ordinary shares representing 15.58 per cent. of the Company's Issued Share Capital.

Director Participation

Certain directors of the Company have participated in the Fundraising at the Issue Price. Details of their participation and changes in holdings in the Company are set out in the table below.

About Stellar Diamonds plc

Stellar is an AIM quoted (AIM: STEL) West African focused diamond development company which has commenced trial mining of its Baoulé kimberlite in Guinea, and is progressing the 1.45 million carat Tongo Dyke-1 resource in Sierra Leone through a definitive feasibility study. In addition, Stellar holds the 3 million carat Droujba project in Guinea and continues to pursue diplomatic channels to ensure the proper reinstatement of its Kono licences in Sierra Leone.

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For further information contact the following or visit the Company's website at www.stellar-diamonds.com.