Gemfields : Cancellation of admission to trading on AIM

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

30 June 2017

Cancellation of admission to trading on AIM

Further to the announcement on 26 June 2017 by Pallinghurst Resources Limited ('Pallinghurst')that it has now declared its unsolicited all-share firm offer to acquire the entire issued and to be issued ordinary share capital of Gemfields plc ('Gemfields') not already held by Pallinghurst (the 'Unsolicited Pallinghurst Offer') to be wholly unconditional, and that it now holds or has received valid acceptances in respect of 414,355,757 Gemfields Shares (representing approximately 75.18% of the existing issued share capital of Gemfields),Gemfields has, at the request of Pallinghurst, applied to the London Stock Exchange for the cancellation of admission to trading on AIM of the Gemfields shares (the 'Cancellation') in accordance with Rule 41 of the AIM Rules.

Gemfields confirms that the 20 business days' notice period for the Cancellation has now commenced. Admission of the Gemfields shares to trading on AIM will be cancelled without the requirement for a resolution of Gemfields shareholders approving such cancellation pursuant to Rule 41 of the AIM Rules. It is anticipated that Cancellation will take effect at 7:00 a.m. (London time) on 28 July 2017.

Pallinghurst has announced that the Unsolicited Pallinghurst Offer will remain open to acceptances until 1:00 p.m. (London time) on 18 July 2017. Beyond this time, Gemfields shareholders will no longer be able to accept the Unsolicited Pallinghurst Offer.

Cancellation will significantly reduce the liquidity and marketability of any Gemfields shares not acquired by Pallinghurst and Gemfields shareholders will no longer be able to effect transactions in Gemfields shares on AIM.

As further detailed in the Gemfields response circular published on 27 June 2017, the Independent Committee of the Board of Gemfields has concluded that Gemfields shareholders should seriously consider whether to accept the Unsolicited Pallinghurst Offer despite the Independent Committee's firm view that the Unsolicited Pallinghurst Offer significantly undervalues Gemfields. Gemfields shareholders who anticipate greater value in their Gemfields shares whilst recognising and being willing to accept the risks associated with remaining as an investor in an unquoted company controlled by Pallinghurst may wish to remain as shareholders in Gemfields.

The procedure for acceptance of the UnsolicitedPallinghurst Offer is set out in the Pallinghurst offer document dated 13 June 2017.

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Enquiries

Grant Thornton UK LLP (Nominated Adviser) +44 20 7383 5100

Philip Secrett / Richard Tonthat

J.P. Morgan Cazenove +44 20 7742 4000

Jamie Riddell / James Robinson

BMO Capital Markets Limited +44 20 7236 1010

Jeff Couch / Neil Haycock Macquarie Capital (Europe) Limited +44 20 3037 2000

Raj Khatri / Nick Stamp

Tavistock (PR Adviser) +44 20 7920 3150

Jos Simson / Emily Fenton

Further information

J.P. Morgan Limited, which conducts its UK investment banking business as J.P. Morgan Cazenove ('J.P. Morgan Cazenove'), BMO Capital Markets Limited and Macquarie Capital (Europe) Limited are authorised and regulated in the United Kingdom by the Financial Conduct Authority. J.P. Morgan Cazenove, BMO Capital Markets Limited and Macquarie Capital (Europe) Limited are acting as financial advisers exclusively for Gemfields and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters set out in this announcement and will not be responsible to anyone other than Gemfields for providing the protections afforded to clients of J.P. Morgan Cazenove, BMO Capital Markets Limited and Macquarie Capital (Europe) Limited or their affiliates, or for providing advice in relation to any matter referred to herein.

Grant Thornton UK LLP is authorised and regulated in the United Kingdom by the Financial Conduct Authority and is acting as nominated adviser for Gemfields and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters set out in this announcement and will not be responsible to anyone other than Gemfields for providing the protections afforded to clients of Grant Thornton UK LLP or for providing advice in relation to any matter referred to herein.

Disclosure requirements of the Takeover Code

Under Rule 8.3(a) of the Takeover Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Takeover Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Publication on website

A copy of this announcement will be made available, subject to certain restrictions relating to persons resident in restricted jurisdictions, on Gemfields' website at www.gemfields.co.uk by no later than 12 noon London time the day following this announcement.

The content of the websites referred to in this announcement is not incorporated into and does not form part of this announcement.