Business
Sale of Ellendale and update on Letseng expansion
Sale of Ellendale and update on Letseng expansion.
About this update from Gem Diamonds Limited
[{"type":"text","content":"\n \nRNS Number : 5121S Gem Diamonds Limited 03 December 2012 \n \n\n \n3 December 2012 \n \nGEM DIAMONDS LIMITED\n \nNEWS RELEASE\n \nSale of Ellendale and update on Letšeng expansion\n \nGem Diamonds Limited (LSE: GEMD) (\"Gem Diamonds\" or the \"Company\") announces (i) the sale of Ellendale Diamond Mine and (ii) provides an update on the status of the Letšeng expansion project, Project Kholo.\n \nSALE OF ELLENDALE DIAMOND MINE\n \nGem Diamonds announces that the Company has entered into a share sale agreement to sell the Ellendale Diamond Mine in Western Australia to ASX listed company Goodrich Resources Limited (\"Goodrich\"). This represents the conclusion of the Company's strategic review of options for the Ellendale Mine that began in November 2011.\n \n \nKey Terms of the Share Sale Agreement\nUnder the conditional share sale agreement, Gem Diamonds will sell to Goodrich 100% of the shares in Gem Diamonds Australia Holdings Pty Limited (the owner of 100% of the Ellendale Mine through its wholly owned subsidiary, Kimberley Diamond Company NL (\"Kimberley Diamonds\"), together with the intercompany loans provided by Gem Diamonds, for a total cash consideration of AUD14.3 million. The consideration comprises an upfront payment of AUD3.1 million with the balance of AUD11.2 million to be paid by Kimberley Diamonds in instalments over the 12 months following completion. In addition, Gem Diamonds will receive a further cash reimbursement for surplus working capital and agreed capital expenditure incurred between the signing of the share sale agreement and the effective date of 31 December 2012. \n \nThe transaction is expected to be completed in January 2013 and is conditional upon Goodrich completing its due diligence process, which must be completed prior to 31 December 2012. \n \nA...