At work in the pit at
Gemfields’ Kagem mine
in Zambia

Johannesburg, South Africa — 22 November 2012

Shares of Pallinghurst Resources have gained as the mining investment company revealed that it was to sell a stake in Faberge to coloured gems miner Gemfields.

Fin24 reports that the deal values Faberge “’ famous for its Tsarist-era jewelled eggs, at about US$142 million. Faberge is famous for the success of the 50 jewelled eggs commissioned by the Imperial Russian family from 1885 through to 1916.

Pallinghurst, whch is headed by a former BHP Billiton executive who was developing a coloured gemstone business under the brand, will remain a 49.3% shareholder.

Pallinghurst shares were trading 1.4% higher at R2.15. The stock has lost nearly a third of its value this year as the economic crisis chokes off demand for luxury goods such as jewellery.

Faberge, which reported revenue of US$6.97 million for the year ended 31 March, currently sells its luxury jewellery through boutiques and retail concessions in Geneva, New York, London and Hong Kong.

Gemfields mainly mines emeralds through its Kagem mine in Zambia, but also has interests in ruby and sapphire deposits.

It will issue up to 214 million shares as consideration for the deal, which will be paid to Faberge shareholders in proportion to their holdings in Faberge.

The deal value was calculated on the basis of a 30-day volume weighted share price as of 20 November, Gemfields said.

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