The money raised in the equity issue was further supported after Stellar Diamonds, the AIM-listed West African diamond mine developer, realised approximately US$300 000 through a sale of diamonds from its Baoulé project.
Issue of Equity
Stellar Diamonds raised the £600 000 before expenses, through a placing of 4 400 000 new ordinary shares of 1 pence each at 10 pence per share in the company and through the subscription of 1 600 000 new ordinary shares at 10 pence per share.
The proceeds of the placing and subscription will be used for general working capital purposes in addition to being used to:
- support the Tongo mine licence application process in Sierra Leone;
- complete the trial mining and diamond sales exercise at Baoulé; and
- complete a maiden resource statement at Baoulé targeting 3 million carats.
Stellar Diamonds’ largest shareholder Deutsche Balaton AG has agreed to subscribe for 1 600 000 subscription shares as part of the placing and subscription, conditional on admission.
Following this, Deutsche Balaton will be interested in 8 512 692 ordinary shares in aggregate representing 26.77% of the enlarged issued share capital of the company.
Baoulé diamond sale
A sale of 3 291 carats was recently completed by auction in Antwerp and realised proceeds of $299 988 at an average of $91.05/carat.
[quote]The lower average price when compared with the previous sale in May 2015 ($156/carat) is due to a different mix of goods with a higher proportion of lower quality stones as well as a broadly weaker rough diamond market since mid-last year.
However, certain gemstones in this most recent auction realised prices of over $1 000/carat and up to $4 600/carat, mostly white gems and fancy coloured yellows, demonstrating that high quality stones are present within the Baoulé pipe.
Following detailed analysis, it was determined that the 55 carat stone that had recently been found at the Baoulé project had a boart exterior, would not add significant value through polishing so it was sold as a rough stone.
It remains the case that this large stone confirms that the Baoulé pipe is a possible source of the large diamonds which have been mined in alluvial deposits downstream of the Baoulé pipe for many years, several of which have been +100 carats in size.