London-listed Gem Diamonds has initiated a programme to buy back up to $2-million of the company’s ordinary shares.
The company has entered into an agreement with Liberum Capital to carry out on-market purchases of its ordinary shares pursuant to the programme.
The sole purpose of the programme is to reduce the capital of the company and Gem intends to hold those ordinary shares purchased under the programme in treasury. Such treasury shares are not entitled to dividends and have no voting rights.
“We are of the view that the value of Gem is not reflected in its current share price. We remain confident about the future and, coupled with our recently proposed $3.8-million dividend (subject to approval at an annual general meeting on June 8), we believe this buyback represents an important mechanism by which to return further capital to shareholders,” says CEO Clifford Elphick.