LONDON — Mining giant Anglo American is planning to sell De Beers, the jewel in its crown, as part of an effort to simplify its portfolio and create value for shareholders.
Anglo American, which is quoted on the London Stock Exchange, said in a stock market filing Tuesday that De Beers will be divested or demerged “to improve strategic flexibility,” both for the diamond company and for Anglo American.
De Beers, which Anglo American fully acquired in 2011, isn’t the only asset on the table. The London-based miner said that it could spin off its coal, nickel and platinum businesses, too.
Duncan Wanblad, chief executive officer of Anglo American, said: “We set out our clear strategic priorities earlier this year: operational excellence, portfolio simplification and growth. Our decision to focus Anglo American’s portfolio in our world-class resource asset base in copper and premium iron ore…marks a major new phase in executing our strategy.”
Wanblad said Anglo American expects that “a radically simpler business will deliver sustainable, incremental value creation through a step change in operational performance and cost reduction.”
Plans to shed the businesses and focus on value creation came 24 hours after a 34 billion pounds takeover bid from the Australian miner BHP. Anglo has rejected that bid, and others, from BHP.
Shares in Anglo American were down more than 3 percent to 26.25 pounds at 11:15 a.m. CET on Tuesday.
The sale of De Beers will mark the end of an era. Anglo had been a shareholder in the diamond miner since the 1920s, and took full control in 2011 after acquiring the Oppenheimer family’s shares.
Under the Oppenheimers De Beers dominated the 20th-century world diamond market, expanding from mining into marketing, retail and branded diamonds under the Forevermark banner.
Stephen Lussier, De Beers Group’s former executive vice president for brands and consumer markets, said the company’s marketing mission has been to sell the “diamond dream,” to countries around the world.
De Beers Group, which is part-owned by the government of Botswana, produces around one third of the world’s rough diamonds, by value, according to the company. It has mines in Botswana, Canada, Namibia and South Africa, in partnership with those countries.
Earlier this year, De Beers reported that after strong demand in 2021 and 2022, global rough diamond demand fell “significantly” in 2023 against a backdrop of waning appetite for luxury goods, especially in China and the U.S.
De Beers said retailers took a “cautious approach” to purchasing new stock last year, which led revenue to fall to $4.3 billion, and rough diamond sales to drop to $3.6 billion. Total rough diamond sales volumes decreased by 19 percent to 24.7 million carats.
Over the past 15 years, and under pressure from shareholders, local communities and activist groups, De Beers has also made strides in sustainability and set ESG goals.
De Beers now works with sightholders (its leading rough diamond buyers) to upload information about diamonds onto the blockchain, and then inform the retailers how they can find a diamond’s history.
De Beers diamonds now have a certificate linked to a QR code that opens up content about their history and provenance.
De Beers is currently working with kimberlite, the rock that diamonds are extracted from, which naturally absorbs and stores CO2. It has trials in place in Canada and South Africa looking at how it can accelerate the speed at which kimberlite can absorb CO2.
De Beers was also an early mover in lab-grown diamonds, and in 2017 it took full control of the retail joint venture it had formed in 2001 with LVMH Moët Hennessy Louis Vuitton. Today, the jeweler has flagship stores in 16 markets worldwide, and operates under the De Beers umbrella.
Since 2015 the jeweler has been expanding its business in China and, and showcasing designs from its high-jewelry collections during Paris’ Haute Couture week as an official member of the Fédération Française de la Couture du Prêt-à-Porter des Couturiers et des Créateurs de Mode.
