Cape Town – Anglo American says it is still negotiating the sale of De Beers and has not agreed on a final price, with CEO Duncan Wanblad dismissing speculation that the diamond giant could be sold for around $1 billion.
“We are absolutely still in a competitive process,” said Wanblad, according to eNCA
Wanblad said the sale was in its final stages but stressed that negotiations were ongoing.
“We are nearing the end stages of that process, but it’s not done until it’s done. And these negotiations are ongoing at the moment.”
Speaking after Anglo American released its interim results, Wanblad said he could not predict the final sale price.
“I actually don’t know realistically what the actual end price is going to be until we actually get through these negotiations.”
‘There is no regret here’
Responding to suggestions that a $1 billion valuation would be disappointing, Wanblad said there was no regret over the decision to sell.
“There’s no sadness here. There’s no regret here. This is an excellent business. It is in the process of transition. It’s being shaped and reshaped as market forces require it to do.”
He added that while the global diamond industry has come under pressure from changing market conditions and competition from lab-grown diamonds, De Beers remains a strong business that could benefit from new ownership.
Meanwhile, AFP reported that De Beers will pause production at its Venetia mine in Limpopo – South Africa’s largest diamond mine – for two years as part of cost-cutting measures amid continued weakness in the global natural diamond market.
The company said the decision was aimed at improving resilience while demand for rough diamonds remains under pressure.
“Rough diamond trading conditions are expected to remain challenging in the near-term.”
Underground project
De Beers said it intends to halt production at Venetia while slowing spending on its underground expansion project.
“De Beers intends to pause production at the Venetia mine in South Africa for two years to reduce costs while also rephasing capital expenditure on its underground project.”
The Venetia mine, which has been operated by De Beers for more than three decades, produces more than 40% of South Africa’s annual diamond output by value and employs around 4,400 workers.
Chief executive Al Cook said the measures were intended to strengthen the business as the diamond industry adapts to changing market conditions.
“We recognise the protracted challenging conditions as the diamond industry evolves, though we are encouraged by signs of consumer demand growth in the US and beyond, particularly in higher quality diamonds.”
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Compiled by Betha Madhomu
