Issue of Shares to Directors

Gem Diamonds Limited
01 June 2007


Gem Diamonds Limited

1 June 2007

News Release


Allotment and Issue of Ordinary Shares to Non-Executive Directors

On 31 May 2007, the Board of Directors of Gem Diamonds Limited ('Gem Diamonds'
or the 'Company') met and formally approved the allotment and issue of ordinary
shares in the capital of the Company ('Ordinary Shares') to the Company's three
Non-Executive Directors on the terms set out in the Prospectus published by the
Company on 14 February 2007 and outlined in more detail below. The Ordinary
Shares will be subscribed for at nominal value of US$0.01 each.

Non-Executive Director                Number of Ordinary Shares
Roger Davis                           289,326
Gavin Beevers                         72,332
Dave Elzas                            72,332


For further information:

Gem Diamonds Limited Tel: [phone]
Graham Wheelock
Angela Parr

Merlin Tel: [phone]
David Simonson
Bridget Fury

ENDS



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