SALE OF THE 550CT LETÅ ENG STARBack
24 Oct 2011
Gem Diamonds, the FTSE 250 listed diamond company (LSE: GEMD), is pleased to announce the sale of the LetÅ¡eng Star, a 550 carat, Type IIa, D colour, white gem diamond recovered on 19 August 2011 at the Company's LetÅ¡eng mine in the Kingdom of Lesotho. The LetÅ¡eng Star is currently ranked as the 14th largest white diamond on record and is the fourth diamond of such historical significance to be recovered at LetÅ¡eng since 2006.
Under the new sales and marketing strategy, the LetÅ¡eng Star has been sold into a profit sharing arrangement for a rough price of US$16.5 million, payable immediately.Â LetÅ¡eng Diamonds will then further benefit from a significant share of the downstream polished margin uplift resulting from the sale of the polished diamonds cut from the LetÅ¡eng Star.
Gem Diamonds CEO, Clifford Elphick commented:
"The LetÅ¡eng Star has the potential to yield an exceptional polished product and the profit sharing arrangement for the polished margin of the LetÅ¡eng Star will ensure that its true value is realised and that LetÅ¡eng Diamonds benefits directly from the exposure to the resulting upside. Gem Diamonds' strategy of maximising revenue generation from our rough diamonds by seeking value-added initiatives further up the diamond value chain is gaining importance for the Group, and we are becoming increasingly successful in selling rough and polished diamonds with good margins being realised."
For further information:
Gem Diamonds Limited:
Glenn Turner, Chief Commercial and Legal Officer
Tel: +44 (0) 203 043 0280
Sherryn Tedder, Investor Relations
Tel: +27 (0) 11 560 9600
Mob: +27 (0) 83 943 4505
Kim O'Farrell, Public and Media Relations
Tel: +44 (0) 203 043 2080
Mob: +44 (0) 776 506 1316
Pelham Bell Pottinger:
James Henderson/James MacFarlane
Tel: +44 (0) 20 7861 3232
About Gem Diamonds:
Gem Diamonds is a leading global diamond producer with a focus on high value diamonds. Its production portfolio comprises kimberlite and lamproite mines in Lesotho and Australia, and a kimberlite mine development project in Botswana. Both producing mines are world-leaders in the production of the highest quality, highest value gems: remarkable white diamonds from the LetÅ¡eng mine in Lesotho and fancy yellow diamonds from the Ellendale mine in Australia. This production positions the Company strongly in a segment of the market expected to generate attractive returns over the long term.Â
Gem Diamonds has a clear and consistent growth strategy, based on the development of its existing assets and carefully targeted acquisitions. The strategy has been implemented with a view to capitalising on the steady improvement in the diamond market seen during 2010 and 2011 and the favourable supply demand dynamics which are expected to continue for the foreseeable future.Â