In the media

Gem junior DiamondCorp seeks JSE listing

15 August 2007

Source: Miningweekly

Author: Matthew Hill

AIM-listed diamond junior DiamondCorp plans to launch a secondary listing on the JSE by October, MD and CEO Paul Loudon said on Wednesday.

The firm had appointed Investec as its sponsor, which was already preparing its listing application, he added, in a telephone interview from London.

DiamondCorp’s primary listing would remain on Aim “technically speaking”, but to all "intents and purposes" it would be on the JSE, Loudon added.

Diamond companies already listed on teh JSE include Tawana, Trans Hex, Diamond Core, Afgem, Thabex and Good Hope Diamonds, while firms such as Rockwell Diamonds and Kimberley Consolidated Mining have indicated they plan to seek a listing on the bourse.

He said that the firm would look to placing additional shares with institutions after the JSE listing, likely in the first quarter of 2008, as part of a “significant” capital raising to pay for the acquisition of South African alluvial miner Sonop Diamond Mining, which it announced on Wednesday.

It would buy the company for $45-million in cash, and 7,5-million shares of 3p each, which added up to a total value of about $90-million, or some R660-million.

Sonop, which reportedly owns one of the biggest private earthmoving fleets in the southern hemisphere, has assets along the Vaal river and the along the middle Orange river, between Douglas and Prieska.

It enjoyed revenue of over R369-million for the year ended February 28, from recovering more than 93 000 ct of gem diamonds, DiamondCorp said.

The London-based firm would pay for the transaction through raising both debt and equity, Loudon told Mining Weekly Online.

Asked if he had any worries that the US subprime mortgage crisis could affect its planned debt raising, Loudon said that DiamondCorp had some large shareholders, which had said they would provide the necessary funding if there was a collapse in the global debt markets.

Loudon went on to say that DiamondCorp was hoping to complete a bankable feasibility study in some 20 months, to develop a 20-year, 35-million ton mine at its Lace project near Klerksdorp.

This could see the firm spending roughly $50-million building a block cave mine, which was expected to produce more than 400 000 ct/y.

In the meanwhile, however, the firm was treating tailings at Lace, and expected to produce 360 000 ct from these activities, over a two-year period.

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