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By : Kevin Dube
Botswana is making an audacious play to seize control of De Beers, sending ripples through the global diamond industry as mining giant Anglo American prepares to divest from the historic gem producer. The southern African nation, already the wellspring of 70% of De Beers’ diamonds, is demanding a controlling stake, a move that could reshape the very architecture of the diamond trade.
Mining Minister Bogolo Kenewendo, in a sharp rebuke to Anglo American, declared to the Financial Times on Wednesday that President Duma Boko remains “resolute in his quest to increase Botswana’s stake in De Beers to ensure Botswana’s full control over this strategic national asset and the entire value chain, including marketing.” Her comments land just ahead of an early August deadline for bids on the diamond business, setting the stage for a high-stakes showdown.
Kenewendo did not mince words, asserting that any sale “without our support will be difficult to achieve.” She further accused Anglo American of a regrettable failure to manage the divestment process with transparency or in coordination with the Botswana government. This public dressing-down highlights the deep fissures emerging in a partnership that has historically defined the diamond world.
De Beers, long the undisputed titan of the diamond industry by value, has been on the block since May 2024. Anglo American’s decision to either sell the unit or launch an initial public offering (IPO) was part of a broader corporate overhaul, a strategic pivot triggered by its successful defense against a colossal £39 billion ($49 billion) takeover bid from Australian rival BHP.
Botswana’s bold manoeuvre comes despite a widening budget deficit, projected to hit 7.5% by 2026, and skepticism from analysts regarding its financial muscle. However, Kenewendo defiantly insisted that “financing is not an issue,” a statement that will undoubtedly be scrutinized by market observers.
On Wednesday, shares of Anglo American edged up 0.3% to close at £23.47 apiece in London, valuing the company at £27.6 billion. The market’s relatively muted reaction belies the potential seismic shift Botswana’s demands could trigger.
Strategic Asset, Market Slump: A Dual Challenge for Anglo
The developments present a formidable hurdle for Anglo’s “dual-track” strategy for its 85% De Beers stake. The diamond market itself has faced significant headwinds, with falling demand from China and the growing ascendancy of lab-grown stones biting into profits. Anglo has already slashed De Beers’ valuation twice, most recently to a mere $4.1 billion in February. The miner also reported a staggering 44% revenue drop in the first quarter and is currently grappling with a formidable $2 billion in unsold diamonds.
Anglo American, for its part, has maintained that it remains in regular talks with Botswana, acknowledging the nation’s pivotal role as a key partner. Yet, the public pronouncements from Gaborone suggest a partnership under immense strain, one where the junior partner is now demanding the keys to the kingdom. The coming weeks will reveal whether Anglo can navigate this intricate dance or if Botswana’s unwavering resolve will force a fundamental reimagining of the global diamond landscape.
