Pricing

Gem Diamonds Limited
14 February 2007


The information contained herein is restricted and is not for publication,
release or distribution, directly or indirectly, in or into the United States,
Australia, Canada or Japan or to residents or citizens of Australia, Canada or
Japan.

The information contained herein does not amount to, nor should it be construed
as, an 'offer to the public' in relation to South African residents.

This announcement is an advertisement and not a prospectus and investors should
not subscribe for or purchase any shares referred to in this announcement except
on the basis of information in the prospectus (the 'Prospectus') to be published
by Gem Diamonds Limited ('Gem Diamonds' or the 'Company') in due course in
connection with the admission of the ordinary shares in the capital of the
Company ('Ordinary Shares') to the Official List of the Financial Services
Authority and to trading on London Stock Exchange plc's main market for listed
securities ('Admission').  Copies of the Prospectus will, following publication,
be available from the Company's registered office and 2 Eaton Gate, London, SW1W
9BJ, being the Company's principal place of business in the UK.


Not for release before 7:00am on 14 February 2007


                              Gem Diamonds Limited
                       ('Gem Diamonds' or the 'Company')

          Announcement of Offer Price of 950 pence per Ordinary Share


Gem Diamonds, a diamond mining business comprising a balanced portfolio of a
producing kimberlite mine, development projects and long-term prospects, located
across central and southern Africa, today announces the successful pricing of
its initial public offering (the 'IPO') to institutional and certain other
investors in the UK and elsewhere of Ordinary Shares on the main market of the
London Stock Exchange (the 'Offer').

The offer price has been set at 950 pence per Ordinary Share (the 'Offer
Price').

Based on the Offer Price, the market capitalisation of Gem Diamonds
immediately following the Offer will be approximately £550 million.  Assuming
FTSE index inclusion, and based on current market valuations, Gem Diamonds would
rank number 218 in the FTSE 250.

The Offer comprises 30 million new Ordinary Shares and 1.285 million
existing Ordinary Shares, together representing approximately 54% of the
approximately 57.9 million Ordinary Shares in issue following completion of the
Offer.

The Company intends to use the proceeds from the Offer to:
     
o    Bring into production selected development projects in the CAR and DRC.

o    Continue to explore and assess remaining exploration targets of the
     Company, its subsidiaries and subsidiary undertakings (the 'Group').

o    Pursue further growth opportunities through the acquisition of further
     mines, projects or prospects.

The Ordinary Shares in the Offer are being placed with a broad base of
institutional investors following a roadshow across the UK and the United States
and with certain non-executive directors of the Company, employees of the Group
and persons connected with the Company and/or senior management within the
Group.

An over-allotment option of up to 4.1 million Ordinary shares,
representing approximately 13 per cent. of the Ordinary shares comprised in the
Offer has been granted, exercisable for a period of up to 30 days from
commencement of conditional dealings in the Ordinary Shares, consisting entirely
of new Ordinary Shares.

Conditional dealings will commence on the London Stock Exchange at 8:00
am (London time) today under the ticker 'GEMD'.

It is expected that Admission of the Ordinary Shares to the Official
List of the Financial Services Authority and to trading on the London Stock
Exchange's market for listed securities will become effective, and unconditional
dealings will commence, at 8:00 am (London time) on Monday, 19 February 2007.

Directors of the Company (the 'Directors'), employees and their related
interests will continue to hold approximately 21.5% of the Ordinary Shares
following the Offer (prior to the exercise of the over-allotment option).  The
Directors and the senior management of the Group have agreed to enter into
lock-up arrangements for a period of 24 months after Admission, under which they
can sell 50% of all shares held by them prior to IPO, and remaining in their
post IPO shareholding, after 12 months and the remaining 50% after 24 months.

Commenting on today's announcement, Clifford Elphick, Executive Chairman and
Chief Executive Officer of Gem Diamonds said:

'We are very encouraged by the strong support received for Gem Diamonds' IPO.
Shareholders who invested in last year's equity private placement have remained
supportive of the Company as we enter the public equity markets.  We are also
especially pleased with the quality of the investors joining us and welcome them
as new shareholders. The collective support of these investors affords us the
considerable financial strength necessary to pursue further growth
opportunities.  We look forward to embarking on the next phase of our
development as a publicly listed company.'

The following individuals have been appointed to the Board of Directors:

Clifford Elphick                        Executive Chairman and Chief Executive
                                        Officer

Kevin Burford                           Chief Financial Officer

Graham Wheelock                         Chief Mineral Resource Manager

Roger Davis                             Senior Non-Executive Director

Gavin Beevers                           Non-Executive Director

Dave Elzas                              Non-Executive Director

Any allocations under the Offer will be conditional on Admission.  All dealings
on the London Stock Exchange between commencement of conditional dealings and
the commencement of unconditional dealings will be on a 'when issued' basis.  If
the Offer does not become unconditional, all such dealings will be of no effect
and any such dealings will be at the sole risk of the parties concerned.

JPMorgan Cazenove Limited ('JPMorgan Cazenove') is Sole Sponsor, Global
Co-ordinator and Bookrunner for the IPO. JPMorgan Cazenove is also acting as
Financial Adviser to Gem Diamonds and as Stabilising Manager.


ENQUIRIES

JPMorgan Cazenove Limited                                  Tel: [phone]
Ian Hannam
Neil Passmore

Merlin                                                     Tel: [phone]
David Simonson
Bridget Fury

Gem Diamonds Limited
Graham Wheelock                                             Tel: [phone]
Kevin Burford                                               Tel: [phone]
Angela Parr                                                 Tel: [phone]
Newman Leach                                                Tel: [phone]





TERMS AND CONDITIONS

The Offer will be conducted in accordance with the terms and conditions set out
below.  Words and phrases defined in the Prospectus shall have the same
respective meanings in these terms and conditions.  Any prospective investor
that wishes to participate in the Offer (and who is eligible to do so in
accordance with the provisions of the Prospectus and the terms and conditions
set out below) will be making an offer to acquire Ordinary Shares and will be
deemed to have read and understood the Pathfinder Prospectus, dated 2 February
2007 (the 'Pathfinder Prospectus') and the information supplementing and
updating the Pathfinder Prospectus published on a restricted access website made
available to prospective investors (the Pathfinder Prospectus as so supplemented
and updated being referred to as the 'Time of Sale Information') in their
entirety and to be participating on the terms and conditions, and to be making
the representations, warranties and acknowledgements and undertakings, contained
in the Prospectus and set out below.

Only persons who are invited to do so may participate in the Offer.  Invitations
to participate will be made by telephone by JPMorgan Cazenove.  Allocations of
Ordinary Shares will be confirmed to investors orally and a contract note will
be despatched as soon as possible thereafter.  JPMorgan Cazenove's oral
confirmation to an investor will constitute a legally binding commitment upon
the investor to purchase the number of Ordinary Shares at the Offer Price
allocated to the investor on the terms and conditions set out in the Prospectus,
the contract note and below and in accordance with the Company's constitutional
documents.

It is expected that Depositary Interests representing Ordinary Shares allotted
or sold to investors in the Offer will be delivered in uncertificated form to
the CREST stock account of JPMorgan Cazenove or its nominee which will hold them
as nominee on behalf of the investor until settlement.  Details of Depositary
Interests are set out in the Prospectus, Part XII 'Depositary Interests'.
Settlement will be on delivery versus payment basis on the date of Admission.
Interest will be chargeable daily on payments to the extent that value is
received after the due date at the rate of 5 percentage points above prevailing
LIBOR.

Upon settlement, Depositary Interests representing Ordinary Shares allotted or
sold in the Offer will be delivered to the CREST account of the investor or
other person specified to JPMorgan Cazenove by the investor for that purpose.
Provided that delivery is to a CREST account for the investor or its nominee or
a person (or its nominee) for which the investor has contracted as agent,
delivery will be free from any liability to UK stamp duty or stamp duty reserve
tax.

If an investor does not comply with the obligation to make payment in full on
the date of Admission, JPMorgan Cazenove may sell Ordinary Shares allocated to
the investor on behalf of such investor and retain from the proceeds an amount
equal to the Offer Price of each such Ordinary Share, plus any interest due.
The investor will, however, remain liable for any shortfall below the Offer
Price and be required to pay any stamp duty or stamp duty reserve tax (together
with any interest or penalties) which may arise upon any transaction in the
Ordinary Shares on behalf of the investor.

The Offer is conditional upon Admission and commencement of trading occurring by
not later than 8 a.m. on 19 February 2007 (or such later time and/or date as the
Company and JPMorgan Cazenove may agree) and on the Underwriting Agreement
becoming unconditional and not having been terminated in accordance with its
terms.

If (a) the conditions in the Underwriting Agreement are not satisfied or waived
by JPMorgan Cazenove or (b) the Underwriting Agreement is terminated, the Offer
will lapse and all rights and obligations which any investor may have accrued
shall cease and determine at such time and no claim can be made in respect
thereof.

By participating in the Offer an investor agrees that its rights and obligations
are conditional upon the Underwriting Agreement becoming unconditional and not
being terminated and that such rights and obligations will not be capable of
rescission or termination by the investor.

JPMorgan Cazenove reserves the right to waive or to extend the time and/or date
for fulfilment of certain of the conditions in the Underwriting Agreement.  Any
such extension or waiver will not affect the commitments of any investor.
Neither JPMorgan Cazenove nor the Company shall have any liability to the
investor (or to any other person whether acting on behalf of an investor or
otherwise) in respect of any decision it may make as to whether or not to waive
or to extend the time and/or date for the satisfaction of any condition in the
Underwriting Agreement.

No investor will be entitled to receive any fee or commission in connection with
the Offer.

TERMS AND CONDITIONS - REPRESENTATIONS AND WARRANTIES

By participating in the Offer each investor (for itself and anyone on whose
behalf it is acting) will:
     
1    represent and warrant that it has read the Prospectus, the Time of Sale 
     Information and these terms and conditions in their entirety;

2    acknowledge that it has been invited to participate in the Offer;

3    represent, warrant and agree that it has neither received nor relied on any 
     other information, representation, warranty or statement (express or 
     implied) made by or on behalf of JPMorgan Cazenove or the Company, other 
     than the Prospectus (and any supplementary prospectus) and the Time of Sale 
     Information and the announcement of which these terms form part and neither
     of the Company nor JPMorgan Cazenove will be liable for the decision of the
     investor to accept the invitation to participate in the Offer based on any 
     other information, representation, warranty or statement;

4    represent and warrant that, at the time Ordinary Shares are offered to and 
     purchased by the investor, it will be the beneficial owner of such Ordinary 
     Shares and it is not a resident of Canada, Australia or Japan;
     
5    acknowledge that the Ordinary Shares have not been and will not be 
     registered under the securities legislation of the United States, Canada,
     Australia, or Japan and, subject to certain exceptions, may not be offered,
     sold, taken up, renounced, delivered or transferred, directly or 
     indirectly, within those jurisdictions;

6    represent and warrant that it is entitled to purchase Ordinary Shares  
     under the laws of all relevant jurisdictions which apply to it and that it 
     has fully observed such laws and obtained all such governmental and other 
     consents which may be required thereunder and complied with all necessary
     formalities (including, without limitation, exchange control regulations) 
     and paying any issue, transfer or other taxes due in any such jurisdiction 
     in respect of the Ordinary Shares acquired under the Offer;

7    warrant to the Company and JPMorgan Cazenove that, in connection with the 
     application made on its behalf, it has complied with and observed all 
     applicable laws and regulations having the force of law and obtained any 
     requisite governmental or other consents which may be required, and that it 
     has not taken any action or omitted to take any action which will or may
     result in the Company or JPMorgan Cazenove or any of their respective
     subsidiaries or their respective directors, officers, agents, employees or
     advisers acting in breach of the legal or regulatory requirements of any
     jurisdiction in connection with the Offer or the application made on its 
     behalf;

8    represent and warrant that if the Ordinary Shares were offered to the 
     investor in the United States, it has signed and delivered to JPMorgan 
     Cazenove or its US affiliate a letter making representations and warranties 
     in form approved by JPMorgan Cazenove;

9    represent and warrant that it has complied with all obligations binding on 
     it in connection with money laundering and terrorist financing under the 
     Proceeds of Crime Act 2002, the Terrorism Act 2003 and the Money Laundering 
     Regulations 2003 (the 'Regulations') and, if making payment on behalf of a 
     third party, that satisfactory evidence has been obtained and recorded by 
     it to verify the identity of the third party as required by the 
     Regulations;

10   represent and warrant that it and any person acting on its behalf fall 
     within paragraph 3(a) of Schedule 11 to the Financial Services and Markets 
     Act 2000, being a person whose ordinary activities involve it in acquiring, 
     holding, managing or disposing of investments (as principal or agent) for 
     the purposes of its business, and within Article 19 and/or 49 of the
     Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, 
     as amended, and undertake that it will acquire, hold, manage or dispose of 
     any Ordinary Shares that are allocated to it for the purposes of its 
     business;

11   represent and warrant that prior to the expiry of a period of six months 
     from the date of Admission it will not offer or sell any Ordinary Shares to 
     persons in the United Kingdom except to persons whose ordinary activities 
     involve them in acquiring, holding, managing or disposing of investments 
     (as principal or agent) for the purposes of their business or otherwise in 
     circumstances which will not result in an offer to the public in the United 
     Kingdom within the meaning of the section 85 (1) of the Financial Services 
     and Markets Act 2000;

12   represent and warrant that it and any person acting on its behalf have all 
     necessary capacity and have obtained all necessary consents and authorities 
     to enable it to commit to a participation in the Offer and to perform its 
     obligations in relation thereto (including, without limitation, in the case 
     of any person on whose behalf it is acting, all necessary consents and
     authorities to agree to the terms set out or referred to in this 
     announcement);

13   represent and warrant to the Company and JPMorgan Cazenove that it has made 
     its own investigation into the tax and/or exchange control consequences of 
     the purchase, receipt, ownership and disposal of Ordinary Shares to be 
     purchased by it and has not relied on the Company, JPMorgan Cazenove or
     their respective subsidiaries or their respective directors, officers, 
     agents, employees or advisers for any advice with respect to tax and/or 
     exchange control related issues;
     
14   represent and warrant to the Company and JPMorgan Cazenove that the issue 
     to it of Ordinary Shares will not give rise to a liability under any of 
     sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts
     and clearance services);

15   acknowledge that the Ordinary Shares have not been and will not be 
     registered under the Securities Act and, subject to certain exceptions,
     may not be offered or sold in the United States;

16   acknowledge that the dates and times (other than the long stop date of 31 
     March 2007) referred to in these terms and conditions and the Prospectus 
     and Time of Sale Information (and any supplementary prospectus) may be 
     altered by JPMorgan Cazenove and/or the Company;

17   undertake that it and any person acting on its behalf  will pay for the 
     Ordinary Shares allocated to it in accordance with these terms and
     conditions on the due time and date set out herein failing which the 
     relevant Ordinary Shares may be placed with other investors or sold as 
     JPMorgan Cazenove in its sole discretion may determine and without 
     liability to the investor;

18   acknowledge that participation in the Offer is on the basis that it is not 
     and will not be a client of JPMorgan Cazenove and that JPMorgan Cazenove 
     has no duties (whether  fiduciary or otherwise) or responsibilities  to it 
     for providing the protections afforded to clients or customers of JPMorgan
     Cazenove nor for providing advice in relation to the Offer nor in respect 
     of any representations, warranties, undertakings or indemnities contained 
     in the Underwriting Agreement nor for the exercise or performance of any of 
     JPMorgan Cazenove's rights and obligations thereunder,  including the right 
     to waive or vary conditions or exercise any termination right;
     
19   acknowledge that where it or any person acting on its behalf is dealing 
     with JPMorgan Cazenove, any money held in an account with JPMorgan Cazenove 
     on its behalf and/or any person acting on its behalf will not be treated as 
     client money within the meaning of the relevant rules and regulations of 
     the Financial Services Authority which therefore do not require JPMorgan
     Cazenove to segregate such money as that money will be held by it under a
     banking relationship and not as trustee;

20   irrevocably authorise the Company and JPMorgan Cazenove as its agent to do 
     all things necessary to effect registration in its name of the Ordinary 
     Shares agreed to be acquired and authorise any director of the Company or 
     JPMorgan Cazenove to execute and/or complete any document of title required
     therefore;

21   warrant to the Company and JPMorgan Cazenove that it has not sent copies of 
     the Pathfinder Prospectus, the Time of Sale Information, the Prospectus (or 
     any supplementary prospectus) or any other document relating to
     the Offer to any other person;

22   acknowledge that to the extent permitted by law, all representations, 
     warranties and conditions, expressed or implied and whether statutory or 
     otherwise (including, without limitation, pre-contractual regulations but 
     excluding any fraudulent representations) are expressly excluded
     in relation to the Ordinary Shares and the Offer;

23   acknowledge that the rights and remedies of each of the Company and 
     JPMorgan Cazenove under these terms and conditions are in addition to any 
     rights and remedies which would otherwise be available to it and the 
     exercise or partial exercise of any one will not prevent the exercise of 
     others or full exercise;

24   undertake that the person whom it specifies for registration as holder of 
     the Ordinary Shares will be (i) the investor itself or (ii) a nominee of 
     the investor, and that it and any person acting on its behalf agrees to 
     purchase on the basis that the Ordinary Shares will be allocated to the 
     CREST account of JPMorgan Cazenove which will hold them as nominee on 
     behalf of the investor until settlement;
     
25   acknowledge that any agreements entered into by the investor pursuant to 
     these terms and conditions shall be governed by and construed in accordance 
     with the laws of England and that it submits (on its behalf and on behalf 
     of any investor on whose behalf it is acting) to the exclusive jurisdiction 
     of the English courts as regards any claim, dispute or matter arising out 
     of any such contract and agrees that nothing shall limit the rights of the 
     Company and/or JPMorgan Cazenove to bring any action, suit or proceeding
     arising out of or in connection with any agreements in any other manner
     permitted by law or in any other competent jurisdiction; and

26   agree that the Company and JPMorgan Cazenove and others will rely upon the 
     truth and accuracy of the foregoing representations, warranties and 
     acknowledgements and undertakings which are given to JPMorgan Cazenove for
     itself and on behalf of the Company and are irrevocable.

The agreement to settle an investor's acquisition (and/or the acquisition of a
person for whom such investor is contracting as agent) free of stamp duty and
stamp duty reserve tax depends on the settlement relating only to an acquisition
by it and/or such person direct from the Company or the Selling Shareholders of
the Ordinary Shares in question.  Such agreement assumes that the Ordinary
Shares are not being acquired in connection with arrangements to issue
depositary receipts or to transfer the Ordinary Shares into a clearance service.
  If there are any such arrangements, or the settlement relates to any other
dealing in the Ordinary Shares, stamp duty or stamp duty reserve tax may be
payable, for which neither the Company nor JPMorgan Cazenove will be
responsible.  If this is the case, each investor should seek its own advice and
notify JPMorgan Cazenove accordingly.



This announcement is for information only and does not constitute an invitation
to underwrite, subscribe or otherwise acquire or dispose of any ordinary shares
in the capital of the Company.


The contents of this announcement, which have been prepared by and are the sole
responsibility of the Company, have been approved solely for the purposes of
section 21(2)(b) of the Financial Services and Markets Act 2000 by JPMorgan
Cazenove Limited of 20 Moorgate, London EC2R 6DA which is acting exclusively for
the Company and no one else in connection with the Offer. It will not regard any
other person (whether or not a recipient of this announcement) as its clients
and will not be responsible to anyone other than the Company for providing the
protections afforded to its clients nor for giving advice in relation to the
Offer, the contents of this announcement or any transaction or arrangement
referred to herein.


This announcement may not be distributed, directly or indirectly, in or into the
United States, Canada, Australia or Japan. This announcement does not constitute
or form part of an offer to sell or issue, or any solicitation of an offer to
buy or subscribe for, any securities referred to herein in the United States or
in any other jurisdiction.  The Offer and the distribution of this announcement
and other information in connection with the Offer in certain jurisdictions may
be restricted by law and persons into whose possession any document or other
information referred to herein comes should inform themselves about and observe
any such restriction. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such jurisdiction.


This announcement does not amount to, nor should it be construed as, an 'offer
to the public' in relation to South African residents.


The securities mentioned herein have not been, and will not be, registered under
the U.S. Securities Act of 1933 as amended (the 'Securities Act'), and may not
be offered or sold in the United States (as such term is defined in Regulation S
under the Securities Act) unless they are registered under the Securities Act or
pursuant to an exemption from the registration requirements of the Securities
Act. No public offer of the Shares is being made in the United Statesor
elsewhere.


The price and value of securities may go up as well as down. Persons needing
advice should contact a professional adviser.


This announcement includes statements that are, or may be deemed to be,
'forward-looking statements'. These forward-looking statements can be identified
by the use of forward-looking terminology, including the terms 'believes',
'estimates', 'plans', 'projects', 'anticipates', 'expects', 'intends', 'may',
'will', or 'should' or, in each case, their negative or other variations or
comparable terminology. These forward-looking statements include matters that
are not historical facts and include statements regarding the Company's
intentions, beliefs or current expectations concerning, among other things, the
Company's results of operations, financial condition, liquidity, prospects,
growth, strategies and the outlook on the diamond mining industry.


By their nature, forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. A number of factors could cause
actual results and developments to differ materially from those expressed or
implied by the forward-looking statements including, without limitation, the
factors to be described in the risk factors section of the Prospectus, and the
factors to be described in the financial review and prospects section of the
Prospectus.


Forward-looking statements may and often do differ materially from actual
results. Any forward-looking statements in this announcement reflect the
Company's view with respect to future events as at the date of this announcement
and are subject to risks relating to future events and other risks,
uncertainties and assumptions relating to the Company's operations, results of
operations, growth strategy and liquidity. Save as required by law or by the
Listing Rules of the Financial Services Authority, the Company undertakes no
obligation publicly to release the results of any revisions to any
forward-looking statements in this announcement that may occur due to any change
in its expectations or to reflect events or circumstances after the date of this
announcement.


Information in this announcement or any of the documents relating to the Offer
cannot be relied upon as a guide to future performance.


 In connection with the Offer, JPMorgan Cazenove Limited, as stabilising
manager, or any of its agents, may (but will be under no obligation to), to the
extent permitted by applicable law, over-allot and effect other transactions
with a view to supporting the market price of the ordinary shares of the Company
at a level higher than that which might otherwise prevail in the open market.
JPMorgan Cazenove Limited is not required to enter into such transactions and
such transactions may be effected on any stock market, over-the-counter market
or otherwise.


In connection with the Offer, the Company has granted to JPMorgan Cazenove
Limited an over-allotment option which will be exercisable in whole or in part,
upon notice by JPMorgan Cazenove Limited from the date of the commencement of
conditional trading for a period of 30 calendar days thereafter.  Pursuant
to such over-allotment option, JPMorgan Cazenove Limited may require the Company
to issue additional ordinary shares up to a maximum of 4.1 million Ordinary
Shares, representing approximately 13 per cent of the total number
of Ordinary Shares comprised in the Offer at the Offer Price to cover
over-allotments, if any, made in connection with the Offer and to cover any
short positions resulting from such over-allotments and/or from sales
of Ordinary Shares effected by it during the stabilisation period.
Any Ordinary Shares issued by the Company following the exercise of
the over-allotment option will be issued on the same terms and conditions as
the Ordinary Shares being issued in the Offer.







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