Update on strategic alternatives process

SouthernEra Diamonds provides update on strategic alternatives process

    Shares issued and outstanding: 173,316,179
    TSX: SDM

    TORONTO, May 15 /CNW/ - SouthernEra Diamonds Inc. ("SouthernEra" or the
"Company") (TSX:SDM-T) today provided an update on its strategic alternatives
process which was initiated in response to the announcement by Mwana Africa
Plc ("Mwana") (AIM: MWA-L) of their intention to make an unsolicited offer
(the "Mwana Proposal") to acquire all of the shares of SouthernEra in exchange
for shares of Mwana.
    The view of the Special Committee of Board of Directors of SouthernEra
(the "Special Committee") is that this opportunistic proposal significantly
undervalues the Company. The Board is committed to achieving maximum value for
SouthernEra shareholders, whether through a sale of the Company, completing
the development of its projects, or otherwise.
    Mr. Patrick Evans, Chairman of the Special Committee of SouthernEra,
noted "The Mwana Proposal has come shortly before a period of expected
significant risk reduction and associated value enhancement for the Company. A
bulk sample at the Badibanga alluvial project is currently underway along with
the drilling program by BHP Billiton ("BHP") on the DRC Kimberlite JV. In
addition drilling has commenced on the Company's recently acquired
diamondiferous kimberlite BK-16 in Botswana."
    As part of the review of strategic alternatives the Special Committee,
through its advisors RBC Capital Markets, has responded to interest in the
Company and contacted several parties with respect to a potential transaction
with SouthernEra. Confidentiality agreements have been signed, an electronic
data room has been opened, and certain parties are conducting due diligence
and meeting with management.
    On May 8, 2007 Mwana announced that BHP had entered into a lock-up
agreement with respect to its 9.05% holding in SouthernEra. Per the terms of
the shareholders agreement between BHP and SouthernEra, BHP has informed the
Company that it has triggered SouthernEra's right-of-first-refusal ("ROFR").
Under the ROFR, the exercise price has been established based upon a formula
in the agreement at 43 cents per share for the 15,684,000 shares. SouthernEra
has until May 22, 2007 to exercise the ROFR and the Company is considering its
options.
    While there can be no assurances that a transaction will result from the
process initiated by SouthernEra, shareholders are urged to take no action
until the Board and its advisers have had the opportunity to review any formal
offer from Mwana once made and the Board has made its recommendation to
shareholders.

    SouthernEra Diamonds is one of Canada's fully integrated diamond
companies with extensive alluvial and kimberlite diamond exploration in the
DRC as well as other countries including Canada and South Africa. The Company
also holds the Klipspringer Diamond Mine in South Africa and maintains an 18
percent free-carried interest in the Camafuca Diamond Project in Angola.

    Some statements contained in this news release are forward-looking and,
therefore, involve uncertainties or risks that could cause actual results to
differ materially. Such forward-looking statements include comments regarding
exploration work. Actual results could differ materially from those
anticipated. The Company disclaims any obligation to update forward-looking
statements.


For further information: SouthernEra Diamonds Inc.: Chris Reynolds, Senior
Vice President, CFO and Secretary, Telephone: [phone], Fax: (416)
359-9141, E-mail: inbox(at)southernera.com, www.southernera.com; London:
4C-Burvale, Carina Corbett, Director, Telephone: [phone], Fax:
[phone], Email: Corbett(at)4c-burvale.co.uk
(SRE)