Gem Diamonds Limited has entered into a binding agreement with Pro Civil (Pty) Ltd for the sale of its Ghaghoo Mine in Botswana which has been under care and maintenance since March 2017.

Under the agreement Pro Civil, which is a Botswana registered company, will acquire 100% of the share capital of Gem Diamonds Botswana Proprietary Limited, owner of the Ghaghoo mine, for a once-off upfront payment of US$ 5.4 million. In addition, Pro Civil will assume the environmental liability currently associated with GDB, Gem Diamonds said.

GDB declared a loss of US$ 4.9 million for the period ended 31 December 2018, and, as at the same date, had gross assets of US$ 3.9 million.

The transaction is expected to be completed in the third quarter of 2019, subject to regulatory approvals within Botswana. Gem Diamonds stated that the Government of Botswana has been consulted throughout the process and is fully conversant with the relevant details of the transaction.

Clifford Elphick, Chief Executive Officer of Gem Diamonds, said, “This sale is in line with our strategic objective to dispose of non-core assets.  Gem Diamonds remains focused on optimising production and efficiency at the Letšeng mine in Lesotho.  On behalf of Gem, we wish the Pro Civil team well for the future, and I would also like to thank the Government of Botswana for its assistance during the sale process.”