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RAPAPORT... Stellar Diamonds plans to raise $950,000 (GBP 618,230) through the placement of 61,823,036 ordinary shares with its directors and other third party investors at a price of 1 pence per share. The placement is being issued on a non-pre-emptive basis pursuant to Stellar Diamonds' existing shareholder authorities and, when issued, will represent approximately 15.5 percent of the enlarged share capital of the company. Proceeds will primarily be used to fund the company’s near-term working capital needs, initial fiscal requirements for a feasibility study on the Tongo diamond project in Sierra Leone and ongoing project care and maintenance at Droujba and Mandala. Additional funding will be required to fully implement the company’s strategy of taking Tongo through feasibility to reach a production decision and although the company is currently in discussion with potential investors or joint venture partners in this regard, there can be no certainty that these discussions will be successfully concluded, according to its statement. Karl Smithson, the CEO of Stellar Diamonds, said, "The strong support shown by the board through this placement is testimony to the value presented by Stellar at this juncture. The funds will be primarily applied to short term working capital obligations of the company and the on-going project costs at Tongo. The next step at Tongo will be commencement of a feasibility study on the 1 million carat dyke-1 resource, where the recent economic scoping study defined a net present value of $53 million, using a 10 percent discount rate.”
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