8 Nov 2007

Further to the announcement by Gem Diamonds on 25 October 2007 of the decision by the Company's Board to extend the Offer Perio from the previously indicated closing date of 2 November 2007 to 16 November 2007 for the cash offer for 100 per cent of the isued share capital of Kimberley Diamond Company NL ("Kimberley"), the Board of Gem Diamonds has elected to further extend the Offer Period to 23 November 2007.

As at the close of business on 7 November 2007, Gem Diamonds Australia Pty Limited (a 100% held subsidiary of the Company) held a relevant interest of 49.42% in Kimberley and had received acceptances in respect of a further 23.12% of Kimberley under the Company's institutional acceptance facility, bringing the total to 72.54%. Gem Diamonds' Board remains committed to completing the Offer in the shortest possible time frame.

As outlined in the circular to shareholders dated 28 September 2007, the Offer is subject to a number of conditions, certain of which have been met. In the interest of encouraging Kimberley shareholders to accept the Offer, Gem Diamonds has undertaken that it will waive all outstanding conditions to the Offer, to the extent that they have not already been met, when the minimum acceptance condition is satisfied.

Definitions used in this announcement shall have the meanings given to them in the shareholder circular posted 28 September 200, except where context requires otherwise.

For further information:
Gem Diamonds Limited

Clifford Elphick
Tel: +44 203 043 0280

Gem Diamond Technical Services (Pty) Limited

Stephen Wetherall
Tel: +27 82 418 8735

Pelham PR

Candice Sgroi
Tel: +44 207 743 6376

About Gem Diamonds:

Gem Diamonds is a diamond mining company with a balanced portfolio of a producing kimberlite mine, two producing alluvial mines, development projects and long?term prospects. Established in July 2005, Gem Diamonds is pursuing an accelerated growth strategy and aims to become one of the world?s leading diamond companies. Gem Diamonds currently has one producing kimberlite mine, Letšeng, in Lesotho, two producing alluvial mines ? Cempaka in Indonesia and Mbelenge in the Democratic Republic of Congo (DRC), a kimberlite development project in Botswana, two development projects in the DRC, one in the Central African Republic and an option to develop the Chiri kimberlite concession in Angola.

The Company recently made an offer to Kimberley Diamond Company's shareholders to acquire their shares in this company, which owns the Ellendale Mine in north Western Australia, and which was approved by Gem Diamonds' shareholders at an Extraordinary General Meeting on 16 October 2007.

Gem Diamonds currently has a specific focus towards higher value diamonds, a segment of the market that its management believes will deliver superior long term returns.

For further information about Gem Diamonds visit www.gemdiamonds.com.