Botswana will double its De Beers stake to 30% under the proposed sale of Anglo American’s holding, President Duma Boko told parliament on Monday, making it the diamond company’s largest single shareholder.
The planned De Beers stake would rise from 15%, Boko said in a speech reported by the Associated Press and Reuters. The report was first published on Monday, so this article is an analysis of what it means.
What does the larger De Beers stake mean for Botswana?
Boko said the move comes with “greater influence in the strategic decisions for decades to come”, Reuters reported. Botswana has the right of first refusal on Anglo American’s 85% stake, which the miner put up for sale in 2024 as part of a restructuring, so its backing is key for the deal to proceed.
Botswana already runs its largest diamond mines through the Debswana joint venture with De Beers, and is one of the world’s biggest natural diamond producers, AP said. The country’s diamond-dependent economy contracted last year after a sharp fall in sales, AP reported.
The purchase has not been finalised. Anglo American said it would continue to work with Botswana, other governments and the buyer, the Global Diamond Consortium, towards binding transaction documents. Details of how Botswana will finance the larger stake were not given in the reports reviewed.
Who is buying Anglo American’s De Beers stake?
The Global Diamond Consortium is led by Gareth Penny, a former De Beers chief executive. Penny said the group was working with the governments of Botswana, Angola, Namibia and Oman towards becoming co-owners, and aimed to finalise agreements with Anglo as soon as possible, according to Reuters.
Boko said Namibia and Angola would also take part, without giving details, AP said. Reuters reported that the Swiss luxury group Richemont, owner of Cartier, is among the companies in talks to join the consortium. Two people with knowledge of the matter, a De Beers sightholder and an industry insider, told Reuters that the rough diamond buyers Diarough, Pluczenik and Grandview Klein Diamonds, and the jeweller Signet, are also in the talks. Those names come from unnamed sources and have not been confirmed by the companies in the reports reviewed. Rosy Blue India, which had been involved, has withdrawn its interest, one person said.
Why does the De Beers stake matter for the diamond market?
The global natural diamond industry is in a downturn, largely because of competition from lab-grown stones and a decline in luxury spending in China, according to analysts cited by AP. Anglo American put De Beers up for sale in 2024 amid that downturn.
Boko said the stake gives Botswana exposure to technology as well as natural diamonds, through Element Six, De Beers’ synthetic diamond business. He said Element Six will take part in a planned $600mn synthetic diamond plant in the United States that Reuters reported in January. Tobias Kormind, managing director of the jewellery brand 77 Diamonds, told Reuters that the prospective owners face the task of rekindling demand for diamonds.
Statements on the sale are carried on the Anglo American website. DNE Africa has also reported on Botswana’s $503.75mn financing from the African Development Bank to cushion energy shocks.
What happens next?
The next step is agreement on binding documents between Anglo American, the consortium and the governments involved. Questions remain over how Botswana will fund its larger De Beers stake, what Angola and Namibia will hold, and which industry groups will join. No timetable has been announced.
FAQ
How big will Botswana’s De Beers stake be?
Botswana will hold 30%, double its current 15%, if the proposed sale goes through, President Duma Boko said.
Who is buying De Beers?
The Global Diamond Consortium, led by former De Beers chief executive Gareth Penny, is the proposed buyer of Anglo American’s 85% stake. The deal is not yet final.
Why is Anglo American selling De Beers?
Anglo put its stake up for sale in 2024 as part of a restructuring focused on minerals expected to boom with the green energy transition, and amid a downturn in the diamond market, according to AP.
Which other countries are involved in the De Beers deal?
Namibia and Angola will participate, Boko said, and the consortium said it is also working with Oman.
