Gem Diamonds Limited Sale of Gem Diamonds Botswana Proprietary Limited (3879J)
23 August 2021 - 4:00PM
UK Regulatory
TIDMGEMD
RNS Number : 3879J
Gem Diamonds Limited
23 August 2021
23 August 2021
GEM DIAMONDS LIMITED
("Gem Diamonds" or "the Company")
Sale of Gem Diamonds Botswana Proprietary Limited
Gem Diamonds Limited (LSE: GEMD) announces that it has entered
into a binding share sale agreement with Okwa Diamonds (Pty) Ltd
("Okwa Diamonds") (the "Purchaser") for the sale of 100% of the
share capital of Gem Diamonds Botswana Proprietary Limited
("GDB").
Okwa Diamonds, an SPV company registered in Botswana, is owned
by Vast Resources PLC, a mining and resource development company
listed on AIM, and by Botswana Diamonds PLC, a diamond exploration
and project development company listed on AIM and the Botswana
Stock Exchange. Vast Resources PLC and Botswana Diamonds PLC are
both parties to the share sale agreement and guarantee the
obligations of Okwa Diamonds.
GDB's primary asset is the Ghaghoo diamond mine in Botswana
which has been on care and maintenance since March 2017, and which
is wholly owned by GDB. As at 31 December 2020, the gross assets of
GDB were US$3.5 million and the loss attributable to GDB for the
12-month period ended 31 December 2020 was US$3.3 million. The
Purchaser will take over all assets and assume all liabilities of
GDB.
The completion of the transaction is subject to certain
Suspensive Conditions including relevant regulatory and competition
authority approvals within Botswana. It is expected that these will
be fulfilled, and the transaction completed in Q4 2021.
Under the share sale agreement, the Purchaser will pay a total
consideration of US$4 million, payable in two instalments of US$2
million each, the first of which is payable 5 (five) days after the
date on which the last Suspensive Condition has been fulfilled or
waived. The second payment is payable on or before 23 December
2021, provided the first payment has been made prior thereto. In
the event the last Suspensive Condition is fulfilled or waived
after 23 December 2021 the full amount of US$4 million will be
payable 5 (five) days after such fulfilment or waiver. Gem Diamonds
will use the sale proceeds for general corporate purposes.
Clifford Elphick, Chief Executive Officer of Gem Diamonds,
commented:
"This sale is in line with our strategic objective to dispose of
non-core assets. Gem Diamonds remains focused on optimising
production and efficiency at the Letšeng mine in Lesotho. On behalf
of Gem, we wish the Okwa Diamonds team well for the future, and I
would also like to thank the Government of Botswana for its
assistance during the sale process."
The Gem Diamonds Limited LEI number is 213800RC2PGGMZQG8L67
For further information:
Gem Diamonds
Susan Wallace, Company Secretarial department
ir@gemdiamonds.com
Celicourt Communications
Mark Antelme / Ollie Mills
Tel: +44 (0) 20 8434 2643
About Gem Diamonds:
Gem Diamonds is a leading global diamond producer of high value
diamonds. The Company owns 70% of the Letšeng mine in Lesotho. The
Letšeng mine is famous for the production of large, top colour,
exceptional white diamonds, making it the highest dollar per carat
kimberlite diamond mine in the world. www.gemdiamonds.com
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END
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