March 11, 2010 Rockwell Diamonds Rights Offering Update
Potential Acquisition Announced
March 11, 2010 - Vancouver, BC. -- Rockwell Diamonds Inc. ("Rockwell" or the "Company") (TSX: RDI; JSE: RDI; OTCBB: RDIAF) announces that it has received a number of enquiries from shareholders who have not received their rights or who are unsure about how to exercise them.
Shareholders are reminded that the rights offer circular can be downloaded from www.SEDAR.com where it was filed on February 4, 2010. Shareholders with questions are encouraged to call their stockbrokers if their Rockwell shares are lodged at a brokerage. Brokers should have received formal notification of the rights and they will automatically sell them on behalf of ineligible persons. Directly-registered shareholders should have received their rights in the mail, unless they are in the US. Questions can be directed to the Company at the phone number below and as well to Computershare, the depositary agent for the rights offering at Tel: 1-800-564-6253.The Company understands that there have not been significant enquiries from its shareholders who hold their shares on the JSE Limited in South Africa but, should any such shareholders have any queries, they may approach their brokers or Computershare South Africa at Tel: 0861 100 933.
In other developments, the Company has signed a term sheet with Etruscan Diamonds Limited whereby the Company proposes to purchase Etruscan's Blue Gum diamond operation in the Ventersdorp region, South Africa. The acquisition is for 74% of the operation with the balance owned pursuant to South Africa's Black Economic Empowerment regime. The price to be paid to Etruscan is an amount not exceeding ZAR 33.5 million (approximately C$4.65 million) payable in Rockwell shares valued at C$0.068 each. The Company will also assume certain non-material property maintenance obligations effective immediately and other financial obligations upon completion of the acquisition.
The Blue Gum alluvial diamond deposit hosts estimated mineral resources of 25 million cubic metres (indicated) with a grade of 2.37 carats/100 cubic metres and 15 million cubic metres (inferred) with a grade of 2.37 carats/100 cubic metres as at October 2009.
Completion of the acquisition is subject to a number of conditions including South African mining ministry consent, securities regulatory approvals including TSX, satisfactory due diligence and project development financing and electric power negotiations. The Rockwell shares to be issued will be subject to escrow, resale and voting restrictions and will not materially affect control. Completion is targeted for the third calendar quarter.
Tania Marshall, PhD., Pr.Sci.Nat., an independent Qualified Person, is responsible for the resource estimate. Dr Marshall has reviewed this news release and is responsible for the technical content.
For further details on Rockwell Diamonds Inc., please visit the Company's website at www.rockwelldiamonds.com or contact Investor Services at (604) 684-6365 or within North America at 1-800-667-2114.
John Bristow President and CEO
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