Gem Diamonds buys UK miner for $83 MN

Acquires 80% interest in Indonesian alluvial diamond mine
Gem Diamonds buys UK miner for $83 MN

UK-listed Gem Diamonds Ltd., which owns the Letseng mine in Lesotho, said it made a cash offer of $83 million (£41.9 million) to acquire the British gold and diamond miner BDI Mining Corp.

The offer of 37 pence per share is at an 8.8 per cent premium to BDI’s closing share price on April 10.

The acquisition gives Gem Diamonds an 80 per cent stake in the Cempaka alluvial diamond mine in Indonesia, where the smaller of two palaeochannels has produced 70,000 carats averaging over $250 per carat, since 2005.

BDI also owns the Woodlark Gold Project in Papua New Guinea, whose gold resources exceed 1 million ounces.

Clifford Elphick, the chairman and chief executive of Gem Diamonds, said: “We believe that our expertise in alluvial diamond mining, together with our intention to undertake additional investment in the Cempaka mine, will significantly enhance the operational performance of Cempaka.”

In February 2007, Gem Diamonds listed on the London Stock Exchange and raised over $600 million to fund four projects in the Democratic Republic of Congo and one in the Central African Republic.


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