/ 9 August 2000

AFGEM DIPS ON DEBUT

THE chairman of African Gem Resources Ltd (Afgem) said uncommitted shareholders were responsible for the steep fall in the group’s share on its debut on the Johannesburg bourse, but was confident its price would firm. The share opened at 400 cents but fell to a low of 245 cents. ”It looks like we have a lot of weak holders of shares and there are a certain number of people wanting to get out of the share, but we aren’t too worried,” said Mike Nunn, the chairman and chief executive of Afgem. The group had placed 30 million shares at 50 cents each with suppliers, distributors and other interested parties when the company was formed in March 1999. ”That is where the selling is coming from and there is nothing we can do about it.” Afgem management and the Industrial Development Corporation, owned by South Africa’s Department of Trade and Industry, own 73 million shares, which cannot be sold for another two years under a sales agreement. A further 30 million shares were offered last week, but only 24 million of those were placed at R4.00. – Reuters