Richemont and Signet in Talks to Join Consortium Buying De Beers
Luxury goods company Richemont and U.S. jeweler Signet are reportedly in discussions to join a consortium aiming to acquire the historic diamond giant De Beers.
Swiss luxury goods maker Richemont, owner of Cartier, Van Cleef & Arpels, and Piaget, is reportedly in talks to join a consortium looking to purchase De Beers, the iconic diamond company. U.S. jewelry retailer Signet is also considering joining the bid.
De Beers, famous for its 1947 "A Diamond is Forever" slogan and its historical role in establishing a dominant diamond cartel, is currently owned by mining giant Anglo American. Anglo American has been seeking to divest its 85% stake in De Beers for several years. The company has faced declining demand for natural diamonds, partly due to the increasing popularity of lab-grown alternatives. Earlier this year, Anglo American reduced the valuation of its diamond division and lowered production forecasts.
The Government of the Republic of Botswana owns the remaining 15% of De Beers.
The leading consortium interested in acquiring De Beers is headed by former De Beers CEO Gareth Penny, who led the company from March 2006 to July 2010. This group also includes the governments of Angola, Botswana, and Namibia. Under their proposed structure, these nations would hold a 49% share, with private companies controlling the rest.
De Beers recently halted production at South Africa's Venetia mine, its largest diamond operation, for a projected two-year period. This decision was a response to a prolonged decline in the price of its products and was aimed at cutting costs.