Diamond Bid: Richemont and Signet in Talks to Join Penny-Led Consortium Bid for De BeersDiamond Bid: Richemont and Signet in Talks to Join Penny-Led Consortium Bid for De Beers

Bloomberg reported on 15 October, citing five people familiar with the matter, that the negotiations are advanced but that there is no guarantee either company will join. The consortium, headed by former De Beers chief executive Gareth Penny, emerged in July as the preferred bidder to buy the miner from Anglo American. It already includes Namibia and Angola, two of the largest diamond producers, and some of the biggest diamond manufacturers.

Botswana's stake and who holds what

Botswana already owns a stake in De Beers. The consortium is in talks with the government about raising that holding to about 25%, according to an earlier Bloomberg report published on 13 October.

Because Botswana, Namibia and Angola are expected to hold significant shares and other private investors are already committed, the report says Richemont and Signet would probably take relatively minor stakes. The size of any stake is unclear.

Mwenendo earlier reported on how Botswana's inflation reached 9.3% in August, a reminder of the price pressures facing one of the world's leading diamond producers.

The bidders behind the brands

Richemont is controlled by South African billionaire Johann Rupert. Its brands include Vacheron Constantin, Cartier and Van Cleef & Arpels, and its jewellery division accounts for about three-quarters of its business. Signet owns Zales, Jared and Kay.

The consortium and Signet declined to comment, and Richemont did not respond to requests for comment.

A sale that has stalled

Anglo American has sought to sell De Beers since fending off an almost KSh 6.49T ($50B) approach from BHP Group in early 2024. The process has stalled amid a diamond market crisis, and Anglo has taken three impairments on the business in three years. It lowered its carrying value for the unit to KSh 298.56B ($2.3B) in February. The report gives no deal price.

Diamond sales spiked during the pandemic and then weakened. A collapse in Chinese luxury spending caused prices to plunge, while synthetic stones, trade tensions and geopolitical shifts added pressure.

Nothing has been signed, and no stakes or price have been agreed. If the talks lead to a larger Botswana holding, Mwenendo's reading is that African governments would hold more of the miner's future income than before. Readers following the region can also see Mwenendo's report on Botswana's electricity output, which reached an index of 214.5 in the first quarter.