What’s Next for De Beers? – by Avi Krawitz (Rapaport Magazine – May 21, 2024)


De Beers draws its value from the diamond market. That value has come under scrutiny after last month’s dramatic bid by BHP Billiton to acquire Anglo American, the 85% shareholder of De Beers — a deal Anglo rejected. The offer, along with the diamond market’s weak performance in 2023, has fueled speculation about the future of De Beers.

Anglo confirmed the rumors on May 14, while laying out its strategy to unlock value after rejecting a second offer from BHP. De Beers will “be divested or demerged, to improve strategic flexibility for both De Beers and Anglo American,” the company stated.

The BHP offer seemed to treat diamonds as an afterthought. The proposed deal would have required Anglo to unbundle its 69.7% stake in Kumba Iron Ore and its 79.2% share in Anglo American Platinum (Amplats), the group’s core South African holdings. The country’s regulators would never approve such a deal as it would result in a significant flight of capital out, one financial-services provider explained in informal discussions.

For the rest of this article: https://rapaport.com/analysis/whats-next-for-de-beers/