London-listed Gemfields Resources has announced a £33-million offer for Tanzanite One to create the world’s leading miner of coloured gemstones.

Gemfields, which owns the rights to the Fabergé luxury goods brand, said on Friday that the combination of the two companies would create a company with considerable critical mass in an industry that was currently fragmented, and characterised by small businesses.

The merger would also enable the marketing of tanzanite using the Fabergé brand, for which Gemfields had acquired an exclusive licence for 15 years.

The enlarged company might also look at applying for a listing on the main board of the LSE, which Gemfields said would further enhance valuation, liquidity and access to capital markets.

Gemfields – part of Brian Gilbertson's companies – owns assets in Zambia, Madagascar and India, while London-listed Tanzanite One owns tanzanite and tsavorite projects in Tanzania.

Late last year, Tanzanite One acquired a Tanzanian asset that could potentially represent the largest-known single-source of tsavorite – a green gemstone – as part of its strategy to position itself as a premium coloured gemstone producer.

Gemfields, founded by its executive vice-chairperson Rajiv Gupta, owns the Kagem emerald mine, in Zambia, which is believed to be the largest nondiamond gemstone mine in the world.

THE OFFER

The Tanzanite One shareholders electing to receive Gemfields shares would receive 1,4 shares for each Tanzanite One share.

Gemfields, along with Pallinghurst, already owned a 13,7% stake in Tanzanite One. The company also said it had received a conditional irrevocable undertaking representing about 19% of the tanzanite-miner’s shares.

Gemfields said it planned to place new shares to finance the proposed offer, as well as using its current cash balances.

The offer was conditional to the approval of Gemfields’ shareholders.

Tanzanite One’s board would consider the proposal at its next meeting, scheduled for September 19.

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