164ct LetÅ¡eng diamond sold for US$ 9.0 millionBack
31 May 2013
Gem Diamonds Limited (LSE: GEMD) is pleased to announce the sale of an exceptional quality 164 carat D colour, Type IIa diamond which was recovered from the Main pipe at the LetÅ¡eng mine on 30 April 2013.
This remarkable rough diamond is expected to produce top colour and top clarity polished diamonds and has been sold into a profit sharing arrangement for US$ 9.0 million (US$ 54 911 per carat), whereby the rough price is received upfront. LetÅ¡eng Diamonds will benefit further from a significant share of the downstream polished margin from the sale of the polished diamonds.
At the LetÅ¡eng mine, two of the four new secondary and tertiary crushers have been successfully installed into Plant 2, on schedule and on budget, and are operational. The remaining two crushers are on schedule to be installed before the end of June as previously announced.
Further work focussing on reducing diamond damage at LetÅ¡eng continues and it is pleasing to report that in addition to the recovery of the 164 carat diamond, a 103 carat diamond was also recovered from the Main pipe during May 2013 and that both diamonds were undamaged. The 103 carat diamond, which is not of the same high quality as the 164 carat diamond, will be sold on the next tender in June.
Gem Diamonds CEO, Clifford Elphick stated:
"The recovery and sale of this high quality 164 carat white diamond reinforces LetÅ¡engâ€™s position as the premier source of exceptional diamonds."
For further information:
Gem Diamonds Limited
Sherryn Tedder, Investor Relations
Tel: +27 (0) 11 560 9600
Mob: +27 (0) 83 943 4505
Pelham Bell Pottinger
Charles Vivian / James MacFarlane
Tel: +44 (0) 207 337 1500861 3232
About Gem Diamonds:
Gem Diamonds is a leading producer of high value diamonds. The Company owns 70% of the LetÅ¡eng mine in Lesotho as well as the Ghaghoo mine, currently in development in Botswana. The LetÅ¡eng 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. Since Gem Diamondsâ€™ acquisition of LetÅ¡eng in 2006, the mine has produced four of the top twenty largest white gem quality diamonds recorded.
Gem Diamonds has a growth strategy based on the expansion of the LetÅ¡eng mine and the development of the Ghaghoo mine, while maintaining its strong balance sheet. The Company seeks to maximise revenue and margin from its rough diamond production by pursuing cutting, polishing and sales and marketing initiatives further along the diamond value chain. With favourable supply/demand dynamics expected to benefit the diamond industry over the medium to long term, particularly at the high end of the market, this strategy positions the Company well to generate attractive returns for shareholders in the coming years.